Accounting, tax and advisory practice Blick Rothenberg is warning that HMRC will crack down on companies and individuals misusing Employee Benefit Trusts (EBT) following the Supreme Court’s ruling on the Rangers football team case.
Commenting on the ruling, Gary Gardner, Partner and tax investigations specialist at Blick Rothenberg, said: “HMRC believed the use of EBTs was a process for disguising remuneration, and it is clear from the resounding unanimous agreement that the Supreme Court agreed with this assertion.
“This may have been the end of the Rangers case, but it is expected that in the coming months HMRC will cast the net far and wide to start going after other beneficiaries and employers misusing EBTs. This will see HMRC issuing Follower Notices and Accelerated Payment Notices, requiring the payment of tax up front before individual cases have been settled.”
Gardner warned that those at the receiving end should look to settle right away rather than wait for the notice to arrive. He said: “HMRC have taken a tougher stance on settlements, but they are still going to welcome disclosures at this stage and timings are extremely important in this situation with the introduction of a loan charge on all outstanding disguised remuneration loans as at 5 April 2019.
“This win for HMRC will further strengthen their hand in the ongoing war against tax avoidance, now supported by additional legislation designed to crack down on avoidance in all its forms, and on those facilitating it."