Manchester United icon Bryan Robson has lost his IR35 tax case against HMRC while also facing a salary cut in his role as club ambassador for the Red Devils.
The former England skipper’s appeal was upheld by the First-tier Tax Tribunal in four of the six disputed tax years. However, the tribunal found that part of his earnings from December 2019 to April 2021 should have been treated as deemed employment income.
Robson was found to have been acting as a ‘disguised employee’ in his ambassadorial position at United, in which he receives £150,000 every six months. He is obliged to make at least 35 personal appearances at functions and events.
His personal service company, Bryan Robson Limited, was found to be heavily dependent on United. The club was found to have accounted for 87 per cent of his income in 2019/20, increasing to 94 per cent in 2020/21.
The increase in dependency strengthened HMRC’s argument that Robson was essentially an employee of the Red Devils, rather than an independent contractor.
The next step will be for the parties to agree on the final amount or return to court, meaning Robson will be hit with a tax bill unless he decides to appeal to the Upper Tribunal.
It stems from HMRC’s belief that Robson should have paid National Insurance contributions in addition to PAYE between December 2019 and April 2021.
Commenting on the case, Seb Maley, CEO of IR35 specialist Qdos, said: “This high-profile HMRC win underscores the importance of ensuring compliance, whether you’re a freelancer, contractor or business engaging these workers.
“Make no mistake, this wasn’t your average freelancer and client relationship. Manchester United controlled many elements of this engagement, a hallmark of an employer-employee relationship.”
It comes after Robson was told by United that his salary would be slashed as part of the cost-cutting measures being implemented by Sir Jim Ratcliffe, according to talkSPORT.
The report states that other club ambassadors, including Denis Irwin and Andy Cole, will also have their earnings reduced in the latest round of cuts at Old Trafford.
United’s money-saving mission has also impacted Sir Alex Ferguson, with the legendary Scot due to leave his ambassadorial role at the end of the season.
He was reportedly told in October that United would no longer commit to the multi-million-pound salary he has received since retiring as manager in 2013.
