ESM4134 - Particular Occupations: Entertainment Industry: TV and Radio Presenters: Factors in Determining Employment Status for Tax: Personal Service

For there to be an employment relationship for tax purposes, there has to be an obligation in the contract for the individual in question to personally provide the service. Where there is no ‘personal service’, we would not view the individual as employed for tax purposes.

There is no personal service in circumstances where an individual has the unrestricted right to provide a substitute to the end user, i.e. send someone else to provide the services. In this situation a presenter would not need to attend work at all and could simply send the other person to perform the work without breach of contract. In these circumstances the presenter would still receive the fee from the engager and then pay the substitute directly themselves.

Substitution does not occur where a presenter swaps their shift with another presenter who is already engaged on the production, for example, a newsreader scheduled to do Tuesday evening swaps with their colleague who was scheduled to present on Thursday. Nor does it occur where the substitute is sourced and / or paid by the engager: that is a replacement presenter under a separate contract.

Typical circumstances where personal service remains present, in the context of substitution are

• Where a presenter is not allowed to send their own substitute. This is the typical position as broadcasters generally want a particular person for their talent and expertise and to determine who stands in for them if they are unavailable.
• Where a presenter has a right to propose alternative personnel to undertake their role, but requires the consent of the engager, who in turn has the right to veto the proposed personnel, then such a right to substitution is fettered and the presenter’s personal service is still required. See ESM0532 and ESM0533

The presence of ‘personal service’ does not automatically mean that the individual is employed for tax purposes but means that other factors must be considered in reaching a decision.