HMRC has published a new GAAR Advisory Panel opinion on the extraction of cash (or equivalent) using trust interests, limited liability partnership and the novation of loans.
The scheme involved a complex series of transactions which resulted in the sole director of the company receiving £950,000 from the company while at the same time owing the same amount to a settlement for the benefit of an LLP which was owned by the company. In essence, the individual would have access to the £950,000 without any tax implications.
The Panel found the arrangements to be ‘contrived, artificial and abnormal’.
HMRC has published a new GAAR Advisory Panel opinion on the extraction of cash (or equivalent) using trust interests, limited liability partnership and the novation of loans.
The scheme involved a complex series of transactions which resulted in the sole director of the company receiving £950,000 from the company while at the same time owing the same amount to a settlement for the benefit of an LLP which was owned by the company. In essence, the individual would have access to the £950,000 without any tax implications.
The Panel found the arrangements to be ‘contrived, artificial and abnormal’.
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