A ‘Win’ for Rangers & Tax Planning

Tax planning has been getting a LOT of bad press recently, however we know that structuring your tax affairs efficiently is something we strive to do every day for our clients.

Ross Martin blogs…

HMRC and Parliament have, for a couple years now, been struggling to emphasise a moral aspect to tax planning. However, the trouble with introducing morality into any situation is that it is subjective. What I think is unacceptable may be perfectly reasonable to another person.

It’s no surprise then that fundamentally the true position boils down to legislation or, if there is some uncertainty, the Courts’ decision.

Some of you may have heard of the Glasgow Rangers tax case where HMRC believed that loans distributed from an award trust should be subject to PAYE. Now we thought that there were stronger constructions than Rangers’ EBT but, other than a handful of smaller elements, this has now been found fully in the defendants’ favour (http://www.bbc.co.uk/news/uk-scotland-glasgow-west-28231598) and certainly seems helpful in providing confirmation, once again, on the tax treatment of genuine loans.

One can only surmise what HMRC will try next – there is still a complete lack of case law to support HMRC’s view on EBTs and having been categorically kicked out of the Courts with Rangers they would seem to have their tail between their legs.

Ross Martin ACA
ross.martin@thepeloton.co.uk

If you’d like to know if you’ve efficiently structured your business and tax affairs, give Ross or one of the team a call on 01326 660022.