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  • Dramatic Licence: HMRC Cast as Villain in Tax Row With Acting Profession

    28 May 2019

    Andy Wood

    The scene: a tax tribunal. Exit, stage left, an actor pursued by an HMRC investigator….

    In these days of melodrama and hyperbole, when commonplace deeds are referred to as either “unique” or “iconic” by certain social media commentators, it’s not unusual to find individuals demonised for simply doing their jobs.

    It’s a role which HMRC Chief Executive Sir Jon Thompson has apparently made his own over recent years.

    Whether tackling alleged abuse among freelancers and football stars, he has generated the kind of antipathy normally associated with pantomime villains.

    The latest assault on his reputation and that of his organisation has come from the ranks of those who are more expected to round out the ranks of the cast in panto and other theatrical productions.

    Christine Payne, the General Secretary of the actors’ union Equity, has accused HMRC of targeting her profession as part of a “co-ordinated attack” and “ruthless grab for revenue”.

    The high point of her monologue was the charge that the Revenue was “on the verge of being out of control”.

    Her fury followed the conclusion of a case involving Robert Glenister, an actor whose credits range from popular TV sitcoms (‘Only Fools and Horses’) to spy thrillers (‘Spooks’) and theatrical hits (‘Glengarry Glen Ross’, ‘Uncle Vanya’).

    He had been accused by HMRC of using a Personal Service Company, Big Bad Wolff Ltd, to dodge National Insurance Contributions (NICs) over the course of a decade.

    After losing an initial tax tribunal in 2017, Glenister subsequently lost an appeal this April.

    He complained that the reverse had left him with a tax bill of £147,000 plus interest and legal fees which would might only be settled by selling his home.

    Equity’s Christine Payne has claimed that the decision coincided with her receiving a draft of new tax guidance following four-way discussions between her union, HMRC the Society of London Theatre and UK Theatre which, she said, a “complete bodge and a disaster”.

    There was no little muttering in the stalls in response to the HMRC retort that its actions were “dictated by the facts…and when the wrong tax is being paid we put things right”.

    Nevertheless, it’s not the first time that thespians have felt the weight of a Revenue thrust.

     The most notable previous case arguably involved the Oscar-winning actress Julie Christie.

    In 1965 and shortly after appearing in ‘Doctor Zhivago’, she was placed under contract to a trust, Black Nominees Limited, as a result of which she was to receive a relatively small salary.

    However, the deal saw her sell her interest in the trust for 82 per cent of her annual salary, a sum which was to be settled in instalments as payments for her acting work came in.

    If it seems a strange arrangement, it’s worth considering that whereas the Income Tax rate for actors at the time was 83 per cent, no tax was due on income received from trusts.

    The then Inland Revenue regarded the matter as tax avoidance and, after a decade of wrangling, it was vindicated.

    Leaving aside Ms Christie’s run-in with the Revenue, it’s worth remembering that the Equity’s suggestion of HMRC inequity is the second time that it’s been accused of being out of control this year alone.

    Before the ink had dried on the Robert Glenister judgement, a report was issued by the All-Party Parliamentary Group on the loan charge.

    The MPs involved decided that “HMRC is an organisation out of control and one that urgently needs a new manner of Parliamentary scrutiny”.

    Determining whether its actions are the result of chaos or, instead, the consequence of carefully considered strategy is somewhat subjective.

    Even so, a cue might come from the earlier findings of the House of Common’s Public Accounts Committee, which believed that the Revenue has simply taken on more than it can chew.

    Could it be that the push for tax receipts has meant Sir Jon Thompson and colleagues adhering more rigidly to the rules than it might have done in the past?

    Even if is flexing its muscles, available data might be thought to dispel notions of HMRC having it in for the acting profession.

    Figures published last year, in fact, revealed that £137 million was paid out in tax relief on theatrical productions in the four years since being introduced.

    Those numbers, of course, may not fit the narrative of those who believe that tax and theatre will always involve clashes.

    William Shakespeare – the Bard himself – was, they will maintain, also the victim of Treasury persecution. All his sonnets and stage-plays surely did not, though, excuse him from the mundanity of paying his taxes, as the National Archives make clear.

    I sense that a difference of opinion extending since Elizabethan times is a story which, given HMRC’s current determined state of mind, has the makings more of a tragedy than a comedy and is a plot which will not have a happy ending for actors, no matter how renowned or wealthy they are.

    Exit stage right


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