K5K Limited v The Commissioners for HMRC

K5K Limited v The Commissioners for HMRC

The Tribunal held that the PAYE and NIC assessments were validly issued in accordance with the statutory requirements, notwithstanding the absence of express reference to section 44 ITEPA 2003. The Tribunal found that section 44 applied to the arrangements between K5K Limited and the workers, as the workers personally provided services to end clients under contracts with the agency, and the contractual chain did not include the workers’ personal companies. The Tribunal rejected the appellant’s arguments on the need for reasons, the relevance of public law challenges, and the contemporaneity of company documents. The appeal was dismissed and the assessments upheld.

Parties
Appellant: K5K Limited; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
12 July 2022
Procedural Posture
Tax Appeal / First Tier Tribunal (tax Chamber) Final Judgment
Outcome
Appeal dismissed
Legal Topics
Income Tax, National Insurance Contributions, Agency Workers, PAYE Regulations, Statutory Interpretation, Validity of Assessments
Tax Law Employment Law Administrative Law Income Tax National Insurance Contributions Agency Workers PAYE Regulations Statutory Interpretation +1 more

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Parties

K5K Limited

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal (tax Chamber) Final Judgment

Legal Issues

  1. 1 Whether the PAYE and NIC assessments issued by HMRC were validly raised without particularising the charging provisions
  2. 2 Whether section 44 ITEPA 2003 applies to the arrangements between K5K Limited and Limited Company Contractors (LCCs) during the relevant period
  3. 3 Whether the contractual arrangements negate the application of the agency worker deeming provision

Ratio Decidendi

The Tribunal held that the PAYE and NIC assessments were validly issued in accordance with the statutory requirements, notwithstanding the absence of express reference to section 44 ITEPA 2003. The Tribunal found that section 44 applied to the arrangements between K5K Limited and the workers, as the workers personally provided services to end clients under contracts with the agency, and the contractual chain did not include the workers’ personal companies. The Tribunal rejected the appellant’s arguments on the need for reasons, the relevance of public law challenges, and the contemporaneity of company documents. The appeal was dismissed and the assessments upheld.

Court Disposition

Appeal dismissed

Orders

  • The appeal is dismissed in full.
  • The PAYE and NIC assessments issued by HMRC are upheld.