Let them entertain you

Two appellants both cruise ship entertainers appealed against HMRC assessments for income tax relating to the tax years 2002 to 2008 inclusive.

The appellants argued that they were employees and therefore entitled to an exemption from income tax in conjunction with the seafarers’ earnings deduction under ITEPA 2003 s 378. HMRC disagreed with the contentions and instead described the appellents as self-employed.

Before working on cruise ships both had been registered as self-employed and HMRC agreed that if their appeals succeeded no tax or National Insurance would be due on the appellants’ cruise line income.

The appellants argued that under the various cruise ships’ contracts particularly in light of the degree of control held by the cruise director they were employed.

The Revenue concentrated on the appellants’ working patterns from...