{"id":3032,"date":"2019-05-17T13:28:16","date_gmt":"2019-05-17T13:28:16","guid":{"rendered":"http:\/\/www.bainesjewitt.co.uk\/blog\/?p=3032"},"modified":"2019-05-17T13:28:24","modified_gmt":"2019-05-17T13:28:24","slug":"hmrc-wins-disguised-remuneration-disputes","status":"publish","type":"post","link":"https:\/\/www.bainesjewitt.co.uk\/blog\/hmrc-wins-disguised-remuneration-disputes\/","title":{"rendered":"HMRC wins disguised remuneration disputes"},"content":{"rendered":"<p>HM Revenue &amp; Customs (HMRC) have been awarded the ruling in two cases involving disguised remuneration arrangements, <a href=\"https:\/\/economia.icaew.com\/news\/may-2019\/hmrc-wins-two-disguised-remuneration-cases\">reports have revealed.\u00a0<\/a><!--more--><\/p>\n<p>The news follows the announcement earlier this year that the regulator would begin imposing the controversial loan charge on contractors involved in such schemes.<\/p>\n<p>HMRC argues that disguised remuneration arrangements are used by companies to reduce their overall tax bill by paying workers in loans. The loan is then routed through a low tax jurisdiction and never repaid, meaning minimal national insurance contributions (NICs) are paid on the sum.<\/p>\n<p>However, the loan charge would see the appropriate amount of tax repaid in full \u2013 with the charge being backdated as many as 20 years &#8211; meaning those involved could face huge tax bills.<\/p>\n<p>In today\u2019s rulings, a First-tier Tribunal (FTT) ruled that Hyrax Resourcing and Curzon Capital had both used disguised remuneration schemes to hide income that should have attracted income tax and NICs.<\/p>\n<p>HMRC said both companies should have come under the disclosure of tax avoidance schemes (DOTAS) scheme, arguing that \u201cthe amounts paid by way of a loan are no different to normal income and are \u2013 and have always been \u2013 taxable\u201d.<\/p>\n<p>Commenting on the outcome of the ruling, the FTT said: \u201cThere is no other rational reason for why anyone would implement a convoluted and expensive set of arrangements which left them with a legal (if economically unreal) obligation to repay a sum that they would otherwise have received as salary, save for the expected tax advantage.\u201d<\/p>\n<p>The FTT added: \u201cIt was self-evidently the case that the tax saving was the main benefit that might be expected to arise from the arrangements.\u201d<\/p>\n<p>According to HMRC\u2019s most recent statistics, some 50,000 workers may be involved in a disguised remuneration scheme. It has asked those to come forward and settle in order to spread the cost over an affordable period of time.<\/p>\n<p><strong>For help and advice on this issue, please get in touch with our expert team.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>HM Revenue &amp; Customs (HMRC) have been awarded the ruling in two cases involving disguised remuneration arrangements, reports have revealed.\u00a0<\/p>\n","protected":false},"author":2,"featured_media":3034,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[45,28,7,27],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3032"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=3032"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3032\/revisions"}],"predecessor-version":[{"id":3033,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/3032\/revisions\/3033"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media\/3034"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=3032"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=3032"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=3032"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}