P Matthews v HMRC

In P Matthews v HMRC (and related appeal) (Upper Tribunal – 6 July) HMRC issued discovery assessments on two people who worked as entertainers on cruise ships. They appealed contending that they should be treated as employees of the company which operated the ships (and as such entitled to seafarers’ earnings deduction). The First-tier Tribunal rejected this contention and dismissed their appeals applying the principles laid down in Davies v Braithwaite (18 TC 198) and observing that the appellants ‘earn their living by entering into a series of separate engagements with a number of different cruise lines in a similar way to actors but with far shorter engagements than normally for actors’. Accordingly they were self-employed. In the Upper Tribunal Mann J upheld this decision. (At the time of writing no transcript of Mann J’s decision is available.)