Disguised remuneration—tax planning environment before rules introduced
Produced in partnership with Pete Miller Miller Partnership for Tolley's Tax Digest and Karen Cooper of Cooper Cavendish LLP
Disguised remuneration—tax planning environment before rules introduced

The following Tax practice note Produced in partnership with Pete Miller Miller Partnership for Tolley's Tax Digest and Karen Cooper of Cooper Cavendish LLP provides comprehensive and up to date legal information covering:

  • Disguised remuneration—tax planning environment before rules introduced
  • Background to EBT tax planning
  • Background to pensions tax planning
  • The disguised remuneration legislation
  • Extension to the self-employed

The huge volume of legislation that comprises Part 7A of the Income Tax (Earnings and Pensions) Act 2003 (ITEPA 2003) (the disguised remuneration rules) was introduced by Finance Act 2011 (FA 2011), although parts of the legislation were effective from the date of publication of the first draft rules, on 9 December 2010 (notably covering loans made by third parties on or after that date). The legislation had long been trailed by HMRC as a counter to what they perceived as abusive tax planning relating, in particular, to certain uses of employee benefit trusts (EBTs) and employer-financed retirement benefit schemes (EFRBSs) which sought to provide pension benefits in excess of the annual and lifetime limits.

The rules have been regularly amended since their introduction in 2011. Following its 2015 Autumn Statement announcement, the government confirmed at Budget 2016 that a further package of measures was to be introduced to tackle the ongoing use of disguised remuneration avoidance schemes. Following a technical consultation which closed on 5 October 2016, the measures, which were included in Finance Act 2017, Finance (No 2) Act 2017 and Finance Act 2018, aim to ensure that those who have used disguised remuneration schemes or are intending to do so in the future are required to pay 'their fair share of tax'.

Key to understanding any legislation, particularly a complex set of

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