The former TV presenter Christa Ackroyd emerged from a landmark five-year tax battle predicted to be the tip of an iceberg for the BBC, in which a tribunal ruled she could face a bill of £419,000 despite not having acted dishonestly.
The long-time Look North host, who was poached from ITV’s rival Calendar programme in 2001, is the first of more than 100 BBC presenters to have been handed a judgement following investigations by HM Revenue and Customs into their contractual arrangements with the corporation.
Ms Ackroyd, who lives near Halifax, broke her silence to describe what she called “five horrendous years of innuendo and gossip” since she was abruptly taken off screen.
She said the judgement by a Tax Chamber tribunal “proves once and for all I am not, nor could I ever have been expected to envisage what would happen when I signed a BBC freelance contract in good faith”.
She had been engaged by the BBC as a freelance through her own “personal service company” – a common arrangement for presenters until HMRC clamped down on the practice.
The case hinged on the IR35 tax legislation, in which so-called “disguised employees” supply their services via a limited company, often paying less tax than if they were employed full-time.
The BBC, which has faced a storm of criticism for its arrangements with high-profile faces, engaged many presenters on similar terms, and an industry expert warned last night that a raft of other judgements could follow, calling into question its personnel practices.
Chris Etherington, a partner at the consulting firm RSM, said: “This decision will be seen as a setback for other appellants taking similar cases to the tribunal.”
Dave Chaplin, founder of Contractor Calculator, an website for freelancers and contractors added: “I have a lot of sympathy for Christa Ackroyd. HMRC has effectively put her out of a job.”
The ruling against Ms Ackroyd acknowledges that she was encouraged by the corporation to work through her company, Christa Ackroyd Media Ltd. The tribunal ruled: “We do not criticise Ms Ackroyd for not realising that IR35 legislation was engaged.
“She took professional advice in relation to the contractual arrangement and was encouraged by the BBC to contract through a personal service company”.
It said the BBC “wanted” to deal with such a company “to avoid any possibility of Ms Ackroyd being an employee”.
Ms Ackroyd said: “I took this case to tribunal to re-establish my honesty and integrity and despite the adverse ruling this judgement has done just that.”
She said the tribunal’s figure of £419,000 in tax and national insurance did not include payments she had already made.
The BBC said last night it was “entirely legitimate” and “standard industry practice” at the time of Ms Ackroyd’s engagement to pay freelances through their existing companies.