Mixed results at the First Tier Tribunal for Bryan Robson where image rights and IR35 clash

Justine Riccomini explains the quirky decision from the FTT involving employment status, image rights and ex- footballer/manager Bryan Robson.

Background

When the decision in the case of Bryan Robson Ltd v HMRC [2025] UKFTT 56 (TC) on 20 January 2025, we discovered that the FTT partially allowed the appeal. The case reached the FTT because Mr Robson, a former footballer/manager at Middlesbrough who had played for England, Manchester United and West Bromwich Albion before that, appealed determinations relating to his Personal Service Company (PSC) Bryan Robson Limited (BRL) and his ambassadorial role at Manchester United. 

The question the FTT needed to resolve

The matters under consideration centred on whether the whole of the consideration paid to BRL should be subject to income tax and NICs as if it were income from an employment under a hypothetical contract (within IR35), or whether part of the payments which related to image rights should be excluded from the computations.  

Central to the case was an “Ambassador Agreement” which had been signed by Manchester United and Bryan Robson Ltd. The agreement contained rights in favour of the football club over Mr Robson’s image in return for a fixed sum twice yearly payment, paid at six monthly intervals. Mr Robson also agreed to make a minimum of 35 personal appearances per six-month period at the request of the club.

The FTT’s approach

Judge Beare admitted that this was the first time that a case had come before the tribunal which required the judiciary to dissect the payments and decide upon the application of IR35 law to the discrete parts of it. This is because an IR35 case has never been heard which calls into question whether payments in respect of image rights should be excluded from the total income computation for IR35 purposes.

Therefore, a new approach was adopted, and the case was divided into two parts to be examined by the FTT – (1) image rights and (2) employment status.

Image rights – intellectual property, or performance of employment -related services?

The court was asked to consider whether the exploitation of Mr Robson’s image rights was a separate and distinct income source from that of his personally performing services. This, despite the fact the images were likely to have been captured whilst Mr Robson was fulfilling his ambassadorial role.  

Arguments and cited cases 

The cases cited by HMRC to advance its argument were the binding precedents of 
The Commissioners for His Majesty’s Revenue and Customs v S & L Barnes Limited [2024] UKUT 262 (TCC); and PD & MJ Limited v The Commissioners for His Majesty’s Revenue and Customs [2024] UKFTT 0038 (TC). HMRC opined that these cases clearly demonstrated the whole of the income paid under the contracts was considered for IR35 purposes, including that relating to image rights. 
 
Notwithstanding this, following reliance on the cases of Sports Club plc v Inspector of Taxes [2000] STC (SCD) 443 and Hull City AFC (Tigers) Limited v The Commissioners for Her Majesty’s Revenue and Customs [2019] UKFTT 227 (TC)
by Mr Robson, the Tribunal concluded that it was fair to determine that a consideration paid for rights over images instead of for personal services rendered should not be classified as employment income.

The only problem was that the football club and Mr Robson had never placed a specific, identifiable value on the image rights portion of the payments.

Employment services – inextricably linked to image rights, or not?

The Tribunal concluded that clearly, viewed through the lens of a hypothetical contract, Mr Robson was under the supervision, direction and control of the football club in respect of his ambassadorial role. The fact that the football club had been assigned rights over his images added weight to the employment argument.   

Decision

The Tribunal concluded that the personal service were within the scope of Chapter 8, Part 2 ITEPA 2003 (The IR35 rules), but that the image rights portion wasn’t. However, because no specific value could be attributed to the image rights, this would need to be worked out between the parties and if they were unable to agree, they should return to the Tribunal. 

Conclusion

It seems that HMRC is increasingly of the opinion that image rights aren’t a form of intellectual property income but are in fact part and parcel of services performed personally under an employment or hypothetical employment contract.  However, if the case is not appealed, then an apportionment must be carried out to determine which part of the payments relates to image rights and which to personally performed services. The value of image rights may thus become a significant issue going forward in employment tax planning.