Richard H Madeley Judith Anne Finnigan v Her Majesty's Revenue & Customs

Facts

Richard Madeley and his wife Judith Finnigan, the television presenters, presented ITV's morning magazine programme "This Morning" from 1993 until 2001 under separate contracts of employment with Granada Television Limited, and they accepted that they were rightly taxed under Schedule E on those emoluments as the law was then understood. In every year from 1993/94 to 2001/02 they claimed to deduct the fees paid to their agent, Anne Sweetbaum of Arlington Enterprises Limited, both under section 201A of the Taxes Act 1988, which permits certain entertainers to deduct agents' fees, and under the general Schedule E rule in section 198 of the Taxes Act 1988. HM Revenue and Customs disallowed the claims under both provisions in every year. For reasons that were not explained and were no longer material, no appeal was brought in respect of the disallowance for 1996/97; the appeal concerned all the other years. The appellants also undertook other engagements, taxed under Schedule D, in respect of which the same agent's fees were allowed without dispute. The aggregate sum claimed across the years under appeal was described as very substantial. The appeals turned on whether their Granada employment was employment as a "theatrical artist", and, alternatively, whether any part of the agent's fees was necessarily incurred in the performance of their duties.