HMRC to open new facility for settling EBTs and similar tax schemes

HMRC to open new facility for settling EBTs and similar tax schemes

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The Supreme Court unanimously ruled in favour of HMRC in the Murray Holdings case (Glasgow Rangers). This was outlined in one of our earlier news items, which you can read here. The decision made it clear that employment earnings should be subject to PAYE; it made no difference that they were paid via a third party such as the EBT used by the football club. HMRC believes that the decision will have wide ranging consequences for other tax planning arrangements involving third parties, which it groups under the heading Disguised Remuneration (DR) schemes.

HMRC will be inviting participants of DR schemes to register an interest in settling their tax liabilities arising from the use of these arrangements. Settling will prevent further immediate action by HMRC, as well as reducing interest charges that would otherwise be payable and giving access to extended payment terms, where these are needed.

This could prove to be a welcome policy decision from HMRC. Many participants in such schemes are already looking to settle but are facing negotiations with HMRC whilst simultaneously dealing with Accelerated Payment Notices and HMRC’s Debt Management. The suggestion that HMRC may hold off further immediate action and offer extended payment terms may make settling historic tax schemes easier and less painful.

If you want to discuss the possibility of settling any tax scheme with HMRC, please contact one of our team or email us via the web site.

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