Former Manchester United and England captain Bryan Robson has lost his IR35 tax battle against HMRC.
Robson will be left with a hefty tax bill after losing part an appeal at the First Tier Tax Tribunal.
It centred around whether the former player was an employee of Manchester United, as a global ambassador, between 2015 and 2021.
The four-day hearing had to decide whether Robson’s work fell within off-payroll working rules, known as IR35, or not.
He appealed all six tax years, of which the first four were allowed, meaning he has to pay tax on the 16 months between December 2019 and April 2021, during which his earnings should have been deemed employment.
Robson was paid £150,000 every six months and was obliged to make at least 35 per appearances at events.
The tribunal told the parties to decide how much extra tax Robson owes.
Seb Maley, CEO of IR35 specialist, Qdos, said: “This wasn’t your average freelancer and client relationship. Man United controlled many elements of this engagement – a hallmark of an employer-employee relationship.
“Ideally, freelancers and contractors working outside of IR35 need a high level of autonomy to be considered truly self-employed.
“There’s a lot to learn from this case, which incidentally might well yet be appealed. First, that contracts need to be watertight, with each party in agreement of the terms – and with that, IR35 status – from the word go. After all, the first port of call for HMRC in an investigation is the contract itself.”
While Dave Chaplin, CEO of IR35 compliance firm IR35 Shield, called the legislation “unworkable” which meant Robson was left in a position of tax uncertainty, almost 10 years after his services were provided.
He said: “The concept of ‘deemed employment’ has never been workable, and the replacement off-payroll legislation is proving to be a considerable drag on the competitiveness of UK business, impeding UK Growth at a time when the Labour Party desperately need the pendulum to swing the other way.
“The government and taxing authorities should be celebrating the entrepreneurial spirit of freelancers who simply want to be their own boss, not vilifying them by enacting damaging ideologically-led legislation which curbs their freedoms.”
tara.o’connor@ft.com
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