Government introduces NICs avoidance bill
Anti-avoidance bill brings disclosure regime to national insurance contributions
The government has introduced an anti-avoidance bill designed to crack down
on tax avoidance through national insurance contributions (NICs)
The legislation extends the disclosure regime to cover national insurance
schemes.
‘In practice the tax disclosure rules provide the information necessary to
counter both tax and NICs avoidance in the usual situation where a scheme seeks
to avoid both,’ a note to the bill says, ‘But they do not provide information in
relation to schemes seeking to avoid only NICs.’
The bill also seeks to give new powers to the Treasury to enact retrospective
rules on NICs, where necessary from the date of Dawn Primarolo’s statement at
last year’s pre-Budget report, which announced ministers’ intention to crack
down hard on city bonus schemes.
City bonus schemes, often devised to avoid NICs, notoriously included payment
of bonuses through exotic items like gold bars, Turkish lira and platinum
sponges.