HMRC has confirmed it will not appeal the tribunal decision that football referees engaged by Professional Game Match Officials Ltd (PGMOL) are self-employed rather than employees, drawing a line under one of the longest-running employment status disputes the tax authority has pursued.
In a statement given to IR35 Shield, an HMRC spokesperson said: “The tribunal decided that these referees were not employees based on the specific facts of the case, and we won’t be appealing this decision. Taking the case to the Supreme Court was important because it clarified how to distinguish employees and self-employed workers for tax purposes, and confirmed our longstanding approach.”
The concession brings to a close a saga that has run for the best part of a decade and travelled all the way to the country’s highest court. The Supreme Court handed down its judgment in September 2024, ruling that the tests of mutuality of obligation and control were both met, before sending the matter back to the First-tier Tribunal to weigh the relationship in the round. When the tribunal applied that final stage, it found the referees did not bear the hallmarks of employment after all.
For Dave Chaplin, chief executive of IR35 Shield and a regular presence at the PGMOL hearings, HMRC’s framing of the outcome sits awkwardly with the result.
“HMRC continues to maintain that its longstanding approach to employment status is correct, which begs the question why they got the referees case wrong for 10 years,” Chaplin said.
His central criticism concerns mutuality of obligation, the principle that has long been a battleground in status cases. “HMRC has consistently argued that mutuality of obligation simply means payment for work completed. However, the Supreme Court ruled otherwise, confirming that the nature of the obligations between the parties was central to determining employment status.”
The distinction matters well beyond the touchline. Mutuality of obligation goes to whether an engager is bound to offer work and the worker bound to accept it. In the referees’ case, the obligations reset after every match, with no commitment on either side to future appointments, a feature the tribunal treated as telling.
Chaplin reserved his sharpest words for HMRC’s Check Employment Status for Tax (CEST) tool, the online questionnaire businesses are encouraged to rely on when determining a contractor’s status.
“If the facts of the case are entered into HMRC’s Check Employment Status for Tax (CEST) tool, it fails to reach the correct conclusion, instead returning an ‘indeterminate’ result and suggesting the case is finely balanced,” he said. “The judge reached the opposite view, stating that the case was not finely balanced and that the referees did not exhibit the hallmarks of employment.”
It is a charge that will resonate with contractors and engagers who have grown wary of the tool. Business Matters has previously reported that HMRC’s updated CEST tool still poses a threat to compliance, and that faith in the tool has fallen so far that only around 10 per cent of contractors now use it, down from roughly 28 per cent at launch. When a tool cannot match the conclusion of a judge presented with the same facts, the case for treating its output as a safe harbour looks thin.
The PGMOL outcome lands in a line of high-profile defeats that have dented HMRC’s record on status. Television presenters including Kaye Adams, who won her own IR35 case against HMRC after a nine-year ordeal, have spent years and considerable sums fending off the taxman over arrangements that tribunals ultimately judged to be genuinely self-employed.
For the businesses and freelancers caught in the middle, the lesson is uncomfortable but clear. Status is decided on the full picture of a working relationship, not on a single factor and not on a one-size-fits-all questionnaire. HMRC may insist its approach has been vindicated, but a ten-year pursuit that ended in defeat, and a tool that could not call the result, tell a more complicated story.