UT (Tax & Chancery) UT/2019/0000122 - [2025] UKUT 00124 (TCC)

This is an appeal against a decision of the First-tier Tribunal (“the FTT”) released on 13 June 2019 (“the Decision”). Mr George Mantides is a doctor specialising in urology. He is the sole director and shareholder of the appellant, which is his personal services company. The appellant received income in connection with locum services provided by Mr Mantides in 2013 to Royal Berkshire Hospital (“RBH”) and Medway Maritime Hospital (“MMH”). Mr Mantides worked as a urologist at RBH in the period March 2013 to August 2013 and at MMH in the period 16 September 2013 to 21 October 2013.

HMRC determined that the income was liable to income tax and national insurance contributions. The determination regarding income tax and the decision regarding national insurance contributions were made by HMRC on the basis of the application of the “intermediaries legislation” in sections 48–61 Income Tax (Earnings and Pensions) Act 2003 (“ITEPA 2003”) and equivalent provisions in the Social Security Contributions (Intermediaries) Regulations 2000. These legislative provisions are commonly known as IR35.

Mr Mantides appealed to the FTT against the determination and decision. The FTT found that the circumstances were such that if the services of Mr Mantides had been provided under a contract directly between MMH and Mr Mantides, then Mr Mantides would not be regarded for income tax purposes as an employee of MMH. The FTT therefore allowed the appeal in relation to services provided to MMH. HMRC sought permission to appeal against that decision, but the application for permission was submitted late and the FTT refused to extend time. A further application by HMRC to this tribunal to extend time was also refused.

As regards Mr Mantides’ work at RBH, the FTT found that the circumstances were such that if his services had been provided under a contract directly between RBH and Mr Mantides, then Mr Mantides would be regarded for income tax purposes as an employee of RBH. The appeal was therefore dismissed in relation to services provided to RBH. The appellant appealed that decision pursuant to permission granted by the FTT on the following grounds:

There was a fourth ground, which was dismissed, and it is not necessary for us to make any further reference to it.

The appeal was heard in part in July 2021 and a decision of this tribunal (Mrs Justice Bacon and Judge Jonathan Cannan) was released on 11 August 2021 (“the UT Decision”). References below in the form FTT[x] are to paragraphs of the Decision, and references in the form UT[x] are to paragraphs of the UT Decision.

The Upper Tribunal held in the UT Decision that the appellant had established the errors of law set out in Grounds 1 and 2 of its appeal. Consideration of Ground 3 was deferred until after the final determination of an appeal against a decision of the Upper Tribunal inHM Revenue & Customs v Professional Game Match Officials Limited [2020] UKUT 147 (TCC) (“PGMOL”).

The judgment of the Court of Appeal in PGMOL was handed down on 17 September 2021. The taxpayer obtained permission to appeal to the Supreme Court, which handed down its judgment on 16 September 2024.

As stated above, this tribunal held in the UT Decision that the errors of law alleged in Grounds 1 and 2 were established. It concluded as follows at UT[59]:

Both parties served further written submissions following the judgment of the Court of Appeal, and further written submissions following the judgment of the Supreme Court. We are grateful to both counsel for their succinct written and oral submissions.

At UT[11] to [15] there is a summary of the FTT’s findings of fact, including the FTT’s findings at FTT[103] as to the terms of the hypothetical contract between Mr Mantides and RBH. The errors of law in Grounds 1 and 2 of the appellant’s grounds of appeal were established in the UT Decision. When construed in light of the UT Decision, the RBH hypothetical contract must now be treated as comprising the following terms: