Disguised Remuneration rules

The government has introduced legislation at the beginning of 2018, comprising the Finance Act 2017 and the Finance Act (No.2) 2017, which seeks to deal with Disguised Remuneration tax avoidance schemes.  The Disguised Remuneration Rules will implement, from 5 April 2019, a loan charge on such tax schemes not disclosed by 31 December 2018, which can extend to all schemes (and tax unaccounted for) going back to 1999.

These new rules combine with the DOTAs scheme, General Anti-abuse Rules and Worldwide Disclosure facility to tackle the increasingly frequent use of tax avoidance schemes.

The definition of employee earnings for income tax purposes was first promoted by the original version of the Income Tax (Earnings and Pensions) Act 2003, which has since been subject to numerous amendments over the years following the need to react to ongoing changes to tax schemes being widely adopted and which were not properly dealt with under the previous rules.

However it is never the case that all tax schemes act to disguise remuneration and indeed some very large organisations have adopted them as effective tax planning strategies for a specific purpose or alternatively to provide retirement benefits for offshore resident employees.

It is impossible to deal with all of the Disguised Remuneration Rules in this answer and each situation will depend on the individual circumstances.

At Francis Wilks & Jones we have considerable experience of tax legislation and defending claims by HMRC or liquidators appointed over companies which face such difficulties and we can assist you with any negotiations with HMRC, including accelerated payment notices, any disguised remuneration scheme issues, personal liability notices, VAT security or any other claim by HMRC, including appeals to Tax Tribunals or insolvency claims.

Please call any member of our Tax Disputes team for your consultation now on 020 7841 0390.  Alternatively email us with your enquiry at info@franciswilksandjones.co.uk and we will call you back at a time convenient to you.