The government’s amendments to Finance Bill 2016, made at report stage, extend until 31 March 2017 the date for withdrawal of transitional relief on investment growth in tax avoidance schemes using employee benefit trusts (EBTs). Legislation in Finance Bill 2016 cl 18, proposed withdrawing the transitional relief on investment returns, introduced as part of the EBT settlement opportunity, for anyone who had not settled with HMRC before 1 December 2016. The amendments will replace references to ‘1 December 2016’ with ‘1 April 2017’.
The reason given for the extension is to ensure all users of disguised remuneration schemes have the opportunity to settle with HMRC before the transitional relief is withdrawn. The change was announced in ‘Spotlight 31’, the latest addition to the list of avoidance schemes HMRC regards as having the widest implications for taxpayers. See http://bit.ly/2aiRysK.
The extension of transitional relief to 31 March 2017 might also allow time for the Murray Group Holdings [2015] CSIH 77 case to be finally resolved in the courts. HMRC won at the Court of Session in Scotland, where the court decided that loans made by EBTs were in fact earnings subject to PAYE and NIC when paid into the EBT. The case is going to be heard at the Supreme Court.
The government’s amendments to Finance Bill 2016, made at report stage, extend until 31 March 2017 the date for withdrawal of transitional relief on investment growth in tax avoidance schemes using employee benefit trusts (EBTs). Legislation in Finance Bill 2016 cl 18, proposed withdrawing the transitional relief on investment returns, introduced as part of the EBT settlement opportunity, for anyone who had not settled with HMRC before 1 December 2016. The amendments will replace references to ‘1 December 2016’ with ‘1 April 2017’.
The reason given for the extension is to ensure all users of disguised remuneration schemes have the opportunity to settle with HMRC before the transitional relief is withdrawn. The change was announced in ‘Spotlight 31’, the latest addition to the list of avoidance schemes HMRC regards as having the widest implications for taxpayers. See http://bit.ly/2aiRysK.
The extension of transitional relief to 31 March 2017 might also allow time for the Murray Group Holdings [2015] CSIH 77 case to be finally resolved in the courts. HMRC won at the Court of Session in Scotland, where the court decided that loans made by EBTs were in fact earnings subject to PAYE and NIC when paid into the EBT. The case is going to be heard at the Supreme Court.
