THE employment status of
bell-ringers, choir members, and organists is not likely to have
troubled the minds of many clergy or church treasurers over the
years. But changes to the way the tax system operates is causing
many old assumptions to be challenged. It highlights what one
expert describes as "bad practice" that has been allowed to creep
In most cases, employment
status is not an issue: musicians and bell-ringers are generally
volunteers who donate their time, and many even make donations to
help pay for robes, bell repairs, and so on. But the status of a
volunteer changes if the people concerned receive a fee for
"performing" at weddings and similar occasional Offices.
Employment status is not
always an easy thing to resolve. Judgment is still awaited from the
Employment Appeal Tribunal in a case heard last November to decide
whether Church of England clergy are employees, or, as is
traditionally understood, office-holders (News, 9 November).
In the case of organists,
employment tribunals have recently decided that they are employees;
or, rather, that the two specific organists bringing separate
claims against different churches were employees (News, 20 February
2008; 20 May 2011). But neither ruling set a precedent that would
cover all organists. Every case has to be decided on its own facts
because of the many different arrangements by which organists carry
out their work.
But the status decided by
an employment tribunal does not necessarily provide a solution,
because it is possible for a person to have one status giving
rights under employment law, and another status under tax laws.
Employment status is not
determined merely by an agreement between the "employer" and the
worker, but on the conditions of the "engagement". An employee
enters into a contract of service, while a self-employed person
enters a contract for services. What that means in practice is not
Typically, an employer will have supervision or
control over an employee, whereas a self- employed person will have
greater freedom to decide how a particular outcome is achieved, and
will also be responsible for providing his or her own tools and
A self-employed person is
responsible for accounts and paying his or her own tax and National
Insurance contributions on the basis of an annual tax return. For
employees, this is taken care of by the employer under the Pay As
You Earn (PAYE) system, and the employer is now responsible for
real-time notification of all payments, no matter how small, to
HMRC (News, 15 March, 3
HMRC has an anonymous
Employment Status Indicator on its website, made up of a series of
questions that indicate whether a person is an employee or
employer. Completing the form using typical responses for
bell-ringers or choir members receiving a fee produces the result
that they are employees.
But Steve Coleman, a
former tax inspector and bell-ringer who writes for the journal
The Ringing World, says that the tool is inaccurate. "If
you get money, you are not necessarily employed or self-employed.
You can get money for other reasons.
"If you get money for a
service, you are still not self-employed if you are not doing it on
a regular basis with a view to making a profit.
"If you get a casual
receipt, it is taxable if it is for a service supplied under a
contract. If you enter into a contract to supply a service on a
one-off basis, that's taxable. The question the courts have
considered over the years is what does that mean . . . and they
have said that it has to be an enforceable contract.
"If you're a chorister,
and you're asked to sing at a wedding, and you're told that you'll
receive a fiver, but decide to stay at home and watch the football
instead, nobody could take a writ of specific performance against
He argued that a
chorister who sang but was not paid would be unable to issue a
claim against the parochial church council because "their
arrangement isn't with the PCC: it is with the bride, the bride's
mother, the groom, or whoever is making arrangements for the
wedding." He said that churches had no responsibility, as they were
"merely handing over the money that they have received".
His view would, however,
appear to be contradicted by a sample wedding-fees form produced by
the C of E as part of its Marriage Project, to be given to
prospective couples (justforvicars-yourchurch-wedding.org). It
includes a list of optional extras, such as bell-ringers, choir,
and organists. The selected options, and their fees, are added to
the statutory fee to produce a total package price, payable to the
This would mean that the
wedding couple's contract is with the church, which would then be
responsible for ensuring that the paid-for services are
A spokesman for the
Charity Commission said: "It is the responsibility of the trustees
to take consideration for the difference between reimbursing
volunteers for expenses, and payments for services by individuals.
The guidelines about this, and the regulation of subsequent taxable
income, are a matter for HMRC."
A spokesman for HMRC says
that payments to bell-ringers and choristers could be treated as
neither employed nor self-employed income, "where they simply
"Whether amounts paid to
an individual for bell-ringing are taxable or not will depend on
the facts of the particular case, as they would for any trade or
activity. Employment status is not a matter of choice: it is
determined by the terms of the engagement between the worker and
the engager - in this case, the church."
"If people put down that
they got some money from wedding fees on their tax return, the
Revenue just tax it," Mr Coleman says. "If you put down that you
have received income, and say that it is taxable income, they are
not going to say, 'Well, hang on, what was this income?' They'll
just tax it. But there have been no cases of the Revenue saying it
should be taxable."
The HMRC's Employment
Status Indicator and further guidance is at www.hmrc.gov.uk/employment-status.