HMRC has announced that the settlement opportunity for employers who have used employee benefit trusts (EBT) to avoid tax will close in March 2015. Taxpayers wishing to settle will need to notify HMRC of their intention by 31 March 2015, and have entered the agreement and paid all amounts due by 31 July 2015.
Simon Wilks, tax partner at PwC, said: ‘The forthcoming withdrawal of the opportunity for businesses to settle disputes over employee benefit trusts without going to court, combined with HMRC’s new rights to demand upfront payment of disputed tax, will see lots of businesses trying to settle with HMRC while there’s a chance.’
The EBT settlement opportunity was opened in April 2011 following the introduction of the new disguised remuneration rules in FA 2011, and according to HMRC it has raised £800m in income tax and NIC from around 700 employers. Jennie Granger, HMRC’s director general of enforcement and compliance, said: ‘This settlement opportunity is just one of a host of ways HMRC is tackling avoidance, not least accelerated payments which mean that many people who have avoided tax will now have to pay up quicker than ever before. This puts them on a level pegging with the vast majority of people who have nothing to do with tax avoidance and pay their tax upfront.’
HMRC and the Liechtenstein government have also announced changes to the LDF to ensure that users of EBTs that are caught by the disclosure of tax avoidance scheme (DOTAS) rules cannot take advantage of the full terms of the facility. HMRC has said that some individuals have tried to use the Liechtenstein disclosure facility (LDF) to pay less tax, and that these individuals ‘should engage in the EBT settlement opportunity instead, while it is still available’, a move which led CIOT spokesman Gary Ashford to comment: ‘Ultimately, this is a statement of intent by HMRC to let people know that the LDF is available, but there is a necessary tightening up of who is entitled to its provisions. As we wait to hear from HMRC about its next steps on accelerated payment notices and follower notices, we see HMRC setting out a new, tougher approach to avoidance.’
HMRC has announced that the settlement opportunity for employers who have used employee benefit trusts (EBT) to avoid tax will close in March 2015. Taxpayers wishing to settle will need to notify HMRC of their intention by 31 March 2015, and have entered the agreement and paid all amounts due by 31 July 2015.
Simon Wilks, tax partner at PwC, said: ‘The forthcoming withdrawal of the opportunity for businesses to settle disputes over employee benefit trusts without going to court, combined with HMRC’s new rights to demand upfront payment of disputed tax, will see lots of businesses trying to settle with HMRC while there’s a chance.’
The EBT settlement opportunity was opened in April 2011 following the introduction of the new disguised remuneration rules in FA 2011, and according to HMRC it has raised £800m in income tax and NIC from around 700 employers. Jennie Granger, HMRC’s director general of enforcement and compliance, said: ‘This settlement opportunity is just one of a host of ways HMRC is tackling avoidance, not least accelerated payments which mean that many people who have avoided tax will now have to pay up quicker than ever before. This puts them on a level pegging with the vast majority of people who have nothing to do with tax avoidance and pay their tax upfront.’
HMRC and the Liechtenstein government have also announced changes to the LDF to ensure that users of EBTs that are caught by the disclosure of tax avoidance scheme (DOTAS) rules cannot take advantage of the full terms of the facility. HMRC has said that some individuals have tried to use the Liechtenstein disclosure facility (LDF) to pay less tax, and that these individuals ‘should engage in the EBT settlement opportunity instead, while it is still available’, a move which led CIOT spokesman Gary Ashford to comment: ‘Ultimately, this is a statement of intent by HMRC to let people know that the LDF is available, but there is a necessary tightening up of who is entitled to its provisions. As we wait to hear from HMRC about its next steps on accelerated payment notices and follower notices, we see HMRC setting out a new, tougher approach to avoidance.’
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