Do You Have An EFRB or EBT That Hasn't Been Settled?
The deadline to deal with it is fast approaching ...
POSTED BY HELEN BEAUMONT ON 23/03/2018 @ 8:00AM
Do you have an Employer Financed Retirement Benefit Schemes (EFRB) or Employee Benefit Trust (EBT) where you haven’t settled the position with HMRC? If so, you need to take immediate action ...
If you haven't settled your EFRB or EBT then remember the deadline is fast approaching!
copyright: bacho12345 / 123rf stock photo
You are probably aware that HMRC has been consulting regarding the impending Loan Charge legislation and the Rangers Tax Case, and that this will have an adverse impact on any EFRBS or EBT’s that you have.
This blog post is to update you on three key matters:
The Loan Charge legislation has now been enacted resulting in PAYE/NIC charges becoming due in April 2019 on all outstanding loans and covenants.
HMRC have indicated they will apply Follower Notices on which, if imposed, will result in additional penalties of up to 50% of the disputed tax becoming due.
There is now no reasonable prospects of successfully defending EFRBS and EBT planning in court.
The result of these developments is that this planning will not succeed as originally envisaged, and, given Follower Notices, taxpayers who have undertaken this planning could end up paying substantially more tax and penalties if they now don't take steps to settle the disputed tax with HMRC.
If you are in receipt of a Follower Notice you have 90-days from receipt of the notice to take corrective action (that is, to take the necessary action to correct your tax position as stipulated by HMRC), or to make representations against the Follower Notice.
"There is no right of appeal against a Follower Notice!"
If you do not take the required corrective action or make representations against the Follower Notice, you may receive a penalty of up to 50% of the disputed tax which is payable in addition to the amount of tax demanded.
Penalties can be reduced (but not below 10%) for the quality of co-operation after failing to take the corrective action. It is highly recommended that actions are taken to stop this penalty arising or reduce any penalty that has been charged.
There is still an opportunity to settle with HMRC, but this opportunity will close on Thursday 31st May 2018. All information must then be supplied to HMRC by 30th September 2018.
You can expect to settle the disputed tax and unwind the planning once HMRC has reviewed this information. If an APN/Follower Notice has been paid, this will be offset against the disputed tax as part of the settlement.
"Would you like to know more?"
If you have an Employer Financed Retirement Benefit Scheme or Employee Benefit Trust that hasn't been settled, and would like some advice, do get in touch with me on 01908 774323 or click here to ping me an email and let's see how I can help you.
Until next time ...
More about Helen Beaumont ...
Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.
Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.
When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.
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