The Pensioneer Trustee Company (Guernsey) Limited

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HMRC To Shut Employee Benefit Trust Amnesty

August 19, 2014

HM Revenue and Customs (HMRC) has confirmed that on April 1, 2015, it will withdraw a tax dispute settlement facility for businesses that used an Employee Benefit Trust (EBT) before April 6, 2011.

The EBT Settlement Opportunity (EBTSO) will now be available solely to employers that have notified HMRC of their intention to settle before March 31, 2015, and only then for agreements that are subsequently entered into before July 31, 2015. All amounts due under a settlement agreement must either be paid by that date or a signed time-to-pay agreement should be in place.

If an employer informs HMRC after March 31, 2015, that it wishes to settle, HMRC will continue to deal with appeals by way of agreement, but not on the beneficial terms of the EBTSO. HMRC said that it expects that settlements agreed after March 31, 2015, may be "substantially" higher.

Legislation introduced in 2011 made it clear that, in HMRC's view, EBTs and similar arrangements do not work. HMRC said that such arrangements are used to minimize income tax and national insurance payments on remuneration to employees and directors, and may also generate a claim for corporate tax deductions for payments into the trust.

 

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The Pensioneer Trustee Company (Guernsey) Limited is licensed by the Guernsey Financial Services Commission under The Regulation of Fiduciaries, Administration Businesses and Company Directors, etc. (Bailiwick of Guernsey) Law, 2000 and subject to The Pension Licensees (Conduct of Business) & Domestic and International Pension Scheme and Gratuity Scheme Rules (No.2) 2017.