Taxation

HMRC has often taken notice of individuals who, ought to often be “employed” through their paymasters in contrast to offering their services on a “self-employed” rate. This is because varying tax procedure applies.

When the beater’s pay really should be “earnings from employment” subsequently it needs to be governed by PAYE plus National insurance. This process could be tedious pertaining to both the individual plus the shoot and can entice penalties if not applied properly. Beaters and the shoot will undoubtedly want to stay away from this.

Fundamental tax requirements

A Business need to operate PAYE and National insurance with respect of all employees. This contrasts with a self-employed individual who must take into account their own tax as well as National insurance to HMRC under Self Assessment.

PAYE can easily include long signing up, regular payments to HMRC, submitting deadlines and fines for wrong or late reporting. There should also be both employers plus employees’ NI contributions to manage. Therefore, where probable, it isn't surprising that beater (plus the shoot) would prefer the beater be treated as self-employed to avoid the demanding PAYE problem.

HMRC would likely obviously prefer most men and women to be treated as “employed”. National insurance contributions will also be greater along with expense claims will be more restrictive for the “employed” individual.

HMRC solution to beaters

In HMRC’s persisted quest to squeeze the taxpayer further - the beater/shoot relationship has not went unnoticed.

The work status and procedure for remunerating a beater ought to be influenced by if the individual is a ‘casual beater’ or not.

A ‘contract’ from a casual beater and the shoot is going to be considered as one of service (“employment”) and consequently the usual PAYE obligations will need to apply. However, HMRC acknowledges that practical problems can easily occur when employers have to operate PAYE for short term arrangements on small amounts. Therefore HMRC have decided that beaters can usually be treated as everyday casuals and income tax does not need to be subtracted provided:

i) The beater is engaged for a time period of up to a day and the employment finishes that day with no agreement for additional work

ii) The beater is compensated in cash at the conclusion of that day

To ensure the employment does indeed end in the same day, there can be no agreements set up to keep the services outside of that time. But the same beater can be utilized by the same shoot again in the future. If there was a legal contract (implied or even formal) for future services then this could be a ‘contract’ and PAYE obligations would come into force.

It's very helpful to note that if HMRC do assess a beater as being employed, it does not automatically entitle the “employed” beater to the associated rights of employment for instance holiday or sick pay. HMRC determination is only applicable for their collection of tax and National insurance functions.

An additional warning to the above ‘casual’ treatment can be that it does not apply to National insurance. The employer (the shoot) will nevertheless as a result have to deduct employee’s National insurance as well as pay employer’s NI if the minimum NI threshold is surpass (£97/wk).

Further responsibilities

Also, any kind of operated shoot will still be needed to keep data of all paid beaters’ earnings, names as well as addresses. Also beaters should keep data of income received plus paid.

Due to the specialist nature of beaters as well as many other country side professions, seeking professional advice is always suggested.

Resources

The author knows loads about taxation employed by Price Bailey certified for a Chartered Accountant in '06 in addition to being a Chartered Tax Adviser in '08. The article author has also knowledge about VAT regarding shoots and has recently succeeded in a case against HMRC relating to registering a local syndicate shoot for VAT purposes.