IR35: Freelancer loses in High Court

The contractor community suffered its second legal blow in as many weeks, as freelancer Bill Hood and his company, Usetech, lost his IR35 appeal against the Inland Revenue in the High Court.

Bill Hood started his business as an oil rig designer in 1996, abandoning it last year after suffering a severe heart attack. The first hearing of his case, by the Special Commissioners, took place in the living room of his Gateshead home, rather than in a courtroom. He did not attend the High Court appeal in London.

His case comes in the wake of the Arctic Systems Section 660 case which the Revenue won in the Special Commissioners last week. Both cases were supported by the Professional Contractors Group and Accountax.

Confusion reigns

The PCG chairman, Simon Juden, said: "Yet again, confusion reigns for small businesses. How are small business owners supposed to determine their tax liabilities when factors they not only do not control but aren't actually allowed to see dictate how much tax they pay?

"It is extremely unfair and unreasonable that people who choose to run their own businesses should have to face constant uncertainty about where they stand in relation to their tax.