Sky Sports presenter Dave Clark worked on a freelance basis, however the First Tier Tribunal has ruled that he was effectively an employee of Sky between 2012 and 2018, i.e. inside IR35, and now faces an estimated £281k tax bill.
Every two years, Clark signed a new agreement with Sky to provide ad hoc broadcasting services, primarily as a presenter and usually for around 64 days a year. Mr Clark was not treated as an employee – he had no access to Sky premises, no employment benefits and no requirement to adhere to staff policies.
HMRC refuted Clark’s argument that there was no mutuality of obligation, saying that Mr Clark was required to personally perform the services as and when required by Sky. “Even though it appears Sky had no obligation to provide continuous work, there was a contractual requirement on Sky to provide payment of £150,000 per year in return for the services of Mr Clark, akin to payment of a retainer. If Mr Clark had refused or failed to perform the services personally when required to do so, he would have been in breach of contract.”
The tribunal also identified that “The fee payable by Sky was neither reduced for no-show nor increased when Mr Clark had to work ‘over-time”. In fact Dave Clark was paid a fixed monthly amount regardless of whether or not he had worked. Furthermore, Sky was considered to have control given that they had first priority on Clark’s services during the sports events he was required to cover.
Ruling against Clark and dismissing the appeal, the judges concluded: “We are satisfied that no factors existed which were inconsistent with the affirmative conclusion that the contractual arrangements between Sky and Mr Clark would have been a contract of service for the duration of the entire relevant period from 1 August 2012 to 31 July 2018 for the purposes of the IR35 legislation.”
