Referees’ tax case ruling will make it “even harder to be self-employed”, says IPSE

A ruling by the Supreme Court today will make it more difficult for people to prove they are legally self-employed, the UK’s freelancer trade body has warned.

The Supreme Court today issued its long-awaited ruling on the case of HMRC v PGMOL (Professional Game Match Officials Limited) – the company that provides referees to league football matches and FA Cup fixtures. The case looked at whether the referees, who were contracted by PGMOL on a self-employed basis, should have been paid and taxed as employees.

At the heart of this case is an argument over ‘mutuality of obligation’ and whether it applies to freelance contracts. The decision is likely to have a big impact on future rulings and will tighten the controversial IR35 tax rules.

Reacting to the ruling this morning, IPSE – the self-employed association – said that it will make proving that someone is self-employed more difficult and called on government to update employment status rules.

IPSE’s Policy Director Andy Chamberlain said: “This ruling makes it even harder to be self-employed in the UK. The Supreme Court has effectively blocked one of the avenues for freelancers to prove that they are legitimately working for themselves.

“HMRC argued that merely by agreeing to do some work for another party, the referees and PGMOL had established ‘mutual obligations’, which is a key indicator of employment. The Supreme Court backed this argument, meaning it will now be much harder to prove that there are not mutual obligations in any work arrangement.

“However, mutuality of obligation isn’t the only factor that must be considered. There is likely now to be more focus on how much control the freelancer has over the work they’re doing.

“We shouldn’t lose sight of the fact that these referees had other jobs and officiated matches in their spare time. They were not employed and did not receive benefits like holiday pay and pension contributions.

“Having a vibrant self-employed sector is great for the economy and for those who choose to work independently. We are pressing the government to take a fresh look at our employment status rules to ensure that they are simpler and fairer for everyone.”

ENDS