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Demibourne case: Further statement

Category Technical - TCN (archive)
AuthorTechnical Department
The case of Demibourne Ltd v HMRC SpC 486 concerned the way in which tax paid by an individual in an employment status case was to be treated for the purpose of a PAYE settlement with the employer. Of particular concern was the potential difficulty raised by the case in terms of whether or not it is possible to continue with long-standing arrangements that have often been applied whereby HMRC has allowed an offset of tax paid by an individual whilst they were treated as self-employed in arriving at the PAYE settlement due from the employer. Further to the statement released on 12 September 2007, HMRC have authorised the statement below from the Demibourne Working party to be released via the CIOT. For the 12 September 2007 statement, go to:

Update on HMRC's position on Demibourne

Following further consultation with the Solicitor's office, HMRC were able to advise that they are exploring a practical legislative solution which recognises that tax might have already been paid by the workers concerned. An implementation date will be considered as part of the work to develop the proposed solution to be put to Ministers for approval. It is also proposed that the working party will meet with HMRC again in the early New Year.

Technical Department
020 7235 9381


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