HMRC gets a red card!
As football fans will know, Professional Game Match Officials Ltd (PGMOL) is the body that oversees professional referees in this country. In June 2026 it was rebranded as ‘Pro Ref’.
An extremely important tax case concerning part-time professional referees (who generally referee below Premier League level while having other main jobs) has looked at whether these referees should be treated as employees of the PGMOL or self-employed contractors when entering into each individual match contract. The case has been rumbling on for many years, eventually reaching the Supreme Court, which clarified the law in this area and then sent the case back down to the First-tier Tribunal to re-examine.
This Tribunal has now found that there are not enough characteristics of employment to prevent the referees being treated as self-employed contractors, so PGMOL does not need to account for PAYE and Class 1 NICs on the match fees paid to the referees. HMRC has said it will not appeal the decision again.
We will not attempt to discuss employment status tax law in detail here, as it is both complicated and nuanced, but a few of the key points that informed the decision are:
1. There was no obligation for PGMOL to offer the referees work, nor for the referees to accept any work offered. Additionally, even after an offer was accepted, the referees had a right to withdraw up to the point of their intended arrival at the football ground; withdrawal did not breach the contract or result in any disciplinary action by PGMOL. As this is fundamentally inconsistent with the structure of employment, neither party was bound in an ongoing or stable relationship of mutual engagement.
2. A structured framework was operated by PGMOL, which governed matters such as appointment, fitness, integrity and discipline, but the referees themselves exercised autonomous judgement when officiating. Although sufficient control was exercised by PGMOL to meet the basic test for an employment relationship, it was regulatory and developmental in nature, rather than being supervisory.
3. PGMOL’s role was administrative and the referees did not participate in PGMOL’s governance, management or commercial activities. The referees were therefore not integrated into the organisation.
4. No salary or retainer was offered, with payment confined to individual matches. Referees generally accepted the offers of matches on a secondary basis, alongside their full-time work. Refereeing did not provide their livelihood.
The principles laid down by the Supreme Court will be relevant to any business engaging contractors. Misclassifying someone who should be an employee as self-employed can prove very costly indeed, particularly if the relationship has existed for a long time. The unpaid PAYE, Employee NICs and Employer NICs that are owed will likely be increased by interest and penalties. Also, as a result of the changes made to IR35 rules a few years ago, most businesses cannot avoid payroll taxes by simply engaging with a contractor’s personal service company, rather than with the contractor directly.
If your business is unsure how a contractor should be classified, or you are a contractor who thinks that an engager has misclassified you, please get in touch. We will help you navigate this difficult area and make sure that the correct amount of tax and NICs is paid.
