HMRC Again.....
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Special Commissioners Ruling
Its official, the Special Commissioners have ruled against HMRC in the Sherburn Aero Club case. It is now beyond doubt that flying instructors are self employed!
I for one am greatly relieved, securing greater net pay and working flexibility.
I for one am greatly relieved, securing greater net pay and working flexibility.
Thread Starter
Join Date: Feb 2009
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HMRC Ruling
Well what about that then??
That is a right one in the eye for a certain former SELF employed FI from Sherburn. (BB)
Maybe he will have to pay his back tax now his bid to be star witness for HMRC has failed.
That is a right one in the eye for a certain former SELF employed FI from Sherburn. (BB)
Maybe he will have to pay his back tax now his bid to be star witness for HMRC has failed.
Slamdunk
- there's still no mention on the Commissioner's website BAILII - 2009 United Kingdom Special Commissioners of Income Tax Decisions - can you give a reference?
HFD
- there's still no mention on the Commissioner's website BAILII - 2009 United Kingdom Special Commissioners of Income Tax Decisions - can you give a reference?
HFD
Join Date: Jan 2009
Location: Doncaster
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HMRC v Sherburn Aero Club.
The judgement is lengthy and in some detail, however the main points in contention were; mutuality, control, equipment supplied, uniforms, substitution and financial risk.
The Special Commisioner concluded that on all points the contract at Sherburn Aero Club satisfied self-employment on all counts.
Mutuality is when there is an obligation for the employer to provide more work and the employed to accept it. No such obligation existed. the FI was entitled to turn down work and cancel attendance at any time and so were the club.
The HMRC used the airfield Pilots Order book and the Instructor OPS, by example, to demonstrate control was in place. The Commisioner rejected that these were control and they did not direct FIs in how to do their job. Both documents enhanced safety and was to the benefit of all concerned. Regulation also required them and were general in application.
Flying the club aircraft did not mean that FIs were employees. The contract was for the sub-contrator FI to teach the club students in the club aircraft. That was what they were contracted to do.
Uniforms do not in themselves mean that the wearer is an employee. The judgement reflected that it is common for sub-contractors to project the contractors image to the customer. Just the same there existed no obligation on the club FIs to wear a uniform.
The sub-contractor FI could substitute if they wished. The judgement recognised that for the club under its legal obligations had to satisfy itself of the substitute instructors qualifications, validity and these requirements made it difficult for substitution at short notice unless the FI substituted with an FI already approved by the club. This regularly took place.
The FI did take a financial risk. Whether owing to illness, weather limitations or aircraft servicability, lessons could be cancelled without notice. The club was also free to cancel lessons without notice for any reasons, and so could the FI.
The Special Commisioner concluded that on all points the contract at Sherburn Aero Club satisfied self-employment on all counts.
Mutuality is when there is an obligation for the employer to provide more work and the employed to accept it. No such obligation existed. the FI was entitled to turn down work and cancel attendance at any time and so were the club.
The HMRC used the airfield Pilots Order book and the Instructor OPS, by example, to demonstrate control was in place. The Commisioner rejected that these were control and they did not direct FIs in how to do their job. Both documents enhanced safety and was to the benefit of all concerned. Regulation also required them and were general in application.
Flying the club aircraft did not mean that FIs were employees. The contract was for the sub-contrator FI to teach the club students in the club aircraft. That was what they were contracted to do.
Uniforms do not in themselves mean that the wearer is an employee. The judgement reflected that it is common for sub-contractors to project the contractors image to the customer. Just the same there existed no obligation on the club FIs to wear a uniform.
The sub-contractor FI could substitute if they wished. The judgement recognised that for the club under its legal obligations had to satisfy itself of the substitute instructors qualifications, validity and these requirements made it difficult for substitution at short notice unless the FI substituted with an FI already approved by the club. This regularly took place.
The FI did take a financial risk. Whether owing to illness, weather limitations or aircraft servicability, lessons could be cancelled without notice. The club was also free to cancel lessons without notice for any reasons, and so could the FI.
