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September 2014

HMRC to close down EBT settlement regime

HMRC have continued to contest that remuneration trusts (EBT's, EFRBS etc) do not work and over recent years there has been something of a game of cat and mouse.

Despite some high profile losses, HMRC have continued to attack such schemes, and in April 2011, opened a settlement opportunity to enable those using EBT's to resolve outstanding enquiries.  To date, approximately 700 users of EBT schemes have settled with HMRC raising over £800m in tax and National Insurance.

This settlement opportunity will close in March 2015.

In the meantime the Finance Bill 2014 has granted HMRC the power to make tax demands based either on:

  • a Follower Notice (FN) - where relevant judicial principles have been finalised in the Courts; or
  • an Advance Payment Notice (APN) - where the planning is under enquiry or appeal.

HMRC have subsequently issued a list of 1169 different schemes affected and have stated that the first notices will be issued in August 2014 but that they anticipate it taking approximately 20 months for all such noticed to be issued.

For further information please contact us.