IR35An IT contractor who has spent eight years battling with Her Majesty’s Revenue & Customs over IR35 claims has emerged victorious after the case was dismissed at the first tier tax tribunal.

Phil Winfield, Director of Primary Path Ltd was initially approached by HMRC in 2004 whilst delivering a design and build project at pharmaceuticals giant GSK.

HMRC argued that the IT contractor had carried out his services to GSK in a manner that appeared similar to an employee. However, the tribunal found that the services were carried out with little involvement from the client, other than checks for standard and quality.

The Judge summarised that:

“The level of control or supervision did not go beyond that which one would expect in the hiring of an independent contractor.”

Employment status tests also revealed that there was no obligation by the client beyond paying for work done by the worker, and his ability to propose a substitute worker was also inconsistent with employment.

Accountax Consulting, who represented Mr Winfield, stated that when applied under the ‘in business on account’ test, it was clear to the judge that the relationship between Mr Winfield and GSK was one of independent services, not that of employee and employer.

This is the third failed attempt in recent months by HMRC to make an IR35 investigation stick, with a series of IR35 defeats including IT contractor business ECR Consulting and engineering specialist Marlen Ltd.

The PCG, of which Mr Winfield is a member, have stated:

“We are still fighting IR35 on all fronts. This means meeting HMRC both in the courts to defend individual cases and at policy level in the IR35 Forum to stop these misapplied cases happening in future.”

Photo by Joe Gratz – CC