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With reference to the replies to the Readers’ Forum query A little work, which dealt with gifts and expenses payments made by charities to volunteers, it is worth challenging HMRC.
I have recently dealt with a case with parallel issues. A charity had made payments to an individual in accordance with the contract made between the two and HMRC contended that the individual was an officer of the charity and therefore the payments should have been subject to PAYE.
After several years debating the issue, HMRC decided – albeit on a without prejudice basis – to concede the point, refunding the several thousand pounds paid on account and dropping the claim for the considerably larger sum being sought.
In other words, HMRC will often push very hard to get payments made under PAYE, but it is usually worth maintaining a firm resistance to unjustified claims.
Keith Gordon, Atlas Chambers
