Man United legend Bryan Robson to be hit with tax bill over ambassador role
Former Manchester United captain Bryan Robson lost a chunk of his IR35 tax case against HMRC as the Tribunal found he was an ‘employee’ in his ambassadorial role at his former club.
Robson has been paid £150,000 every six months to be an ambassador of the Red Devils, a role he has held since 2008.
He has the obligation to make a minimum of 35 personal appearances at functions and events.
His personal services company, known as Bryan Robson Limited, issued an appeal to the First-Tier Tribunal after HMRC took the view he provided services to Manchester United in a way that reflected employment and not self-employment.
HMRC took the view that his tax bill belonged inside the scope of the IR35 legislation.
IR35 refers to legislation designed to ensure that workers who are essentially employees pay the same income tax and National Insurance contributions as direct employees.
It was noted that Robson was economically dependent on his former football team, which made up 87 per cent of his income (£171,000) in the 2019/20 tax year and 94 per cent of his income (£319,000) in the ‘20/21 tax year.
HMRC believe he should have paid his National Insurance contribution (NIC) and PAYE between December 2019 to April 2021.
However, that amount was not disclosed due to the fact HMRC included a separate income he received through image rights within its calculations.
Robson’s appeal against this decision went to the Tribunal last November, with a ruling issued on Tuesday. The Tribunal allowed Robson’s appeal for tax years 2016, 2018, and 2019 but dismissed parts related to employment income for later years.
For 2020 and 2021, payments under the ambassador agreement tied to image rights or made before 3 December 2019 were excluded from employment taxes; the rest was upheld as taxable income.
The parties must now agree on the final amounts or return to court, meaning Robson will be left with a tax bill, depending on whether he tries to appeal this ruling to the Upper Tribunal or not.
Commenting on this case, Seb Maley, CEO of IR35 specialist Qdos, said that “this high profile HMRC win underscores the importance of ensuring compliance – whether you’re a freelancer, contractor or business engaging these workers.
“But make no mistake, this wasn’t your average freelancer and client relationship. Manchester United controlled many elements of this engagement – a hallmark of an employer-employee relationship.”
While Dave Chaplin, CEO of IR35 Shield noted that “Robson is now a member of another unfortunate club, the ‘IR35 Decade Club’ of individuals who, due to the unworkable IR35 legislation, was left in a position of tax uncertainty, almost 10 years after his services were provided.”
He added that “given the case’s complexity.. it is unlikely that the final tax bill owed by Robson will cover the cost of HMRC’s internal fees, counsel fees, and the hearing, leaving a net loss to the Treasury.”
This comes as news according to talkSPORT that United ambassadors, including Robson, are set to have their salaries slashed, as the cost cutting continues at the Premier League club.
However, Robson is not the only celebrity or sports star to be caught up in the IR35 battle with the taxman. Just last August, former Sky Sports rugby commentator Stuart Barnes was stung by IR35 after a Tribunal overturned his appeal to pay a near £700,000 bill to HMRC.
While in December, Gary Lineker’s dispute over a £4.9m tax bill was back in court as HMRC aims to overturn a previous ruling in the Match of the Day presenter’s favour.