Employee Benefit Trusts (EBT) – Red Flag
HMRC had run an EBT settlement scheme which allowed business to register their intention to settle with HMRC by the 31st July 2015, and this then gave them favourable settlement terms with HMRC. Many advisors advised clients to wait to see what the court’s decision was on a land mark case involving Rangers FC and HMRC, believing that HMRC would extend the 31st July 2015 deadline. The courts ruled that Rangers FC had run a “contrived” EBT scheme structure, essentially making EBT’s illegal. I am not a football fan so honestly cannot say that Rangers FC lost the case because they are Rangers FC, for those interested the corporate entity that housed Rangers FC are now in liquidation.
Those that had been advised to wait will now be paying penalties of 50% or above of the tax due because since the landmark ruling HMRC have made it clear that they will not extend their settlement scheme beyond 31st July 2015. The advice then to any high earner should totally avoid Employee Benefit Schemes. The following article goes into a little more detail http://www.accountancyage.com/aa/news/2434461/-no-plans-to-reopen-ebt-settlement-scheme-post-rangers-ruling?utm_medium=email&utm_term=&utm_content=%E2%80%98No%20plans%E2%80%99%20to%20reopen%20EBT%20settlement%20scheme%20post-Rangers%20ruling&utm_campaign=AA.Essentials_RL.EU.A.U&utm_source=AA.DCM.Editors_Updates
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