TaxCorporate TaxHMRC closes down employee benefit trust scheme

HMRC closes down employee benefit trust scheme

A tax avoidance scheme involving employee benefits trusts has been shut down by HMRC

HMRC closes down employee benefit trust scheme

A TAX AVOIDANCE SCHEME that operated by channelling profits of a tax advisory business through employee benefits trusts has been closed down by a tribunal.

HM Revenue & Customs challenged £9m made in tax deductions made by companies owned by tax adviser John Dryburgh – Scotts Atlantic Management and Scotts Film Management – paid into employee benefits trusts.

The payments came out of profits earned by selling tax avoidance film schemes. The scheme involved trying to extract profits from companies while at the same time securing corporation tax deductions. Employers paid money into an employee benefit trust and claimed corporation tax deductions. The trust gave undervalued shares in a new company, causing a loss to the employer.

In denying the deductions, the tribunal has protected around £2.4m in tax.

Although Dryburgh is in bankruptcy, HMRC believes the money can be recovered.

The tribunal said: “There is no doubt that Mr Dryburgh not only lied to the tribunal in a material way, but he appeared also to have fabricated evidence, forged documents and thrown away a memory stick in order to destroy evidence.”

Exchequer secretary to the Treasury David Gauke added: “This scheme – like so many others – was not worth buying into. The government has made almost £1 billion available to HMRC to tackle the issues of avoidance and evasion and to ensure that the minority who try to avoid their responsibilities pay the tax due.”

Related Articles

Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

Corporate Tax Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

7d Alia Shoaib, Reporter
EU divided over radical tax reforms targeting tech giants

Corporate Tax EU divided over radical tax reforms targeting tech giants

2w Alia Shoaib, Reporter
How to educate your clients about tax avoidance

Corporate Tax How to educate your clients about tax avoidance

2w Clear Books | Sponsored
HMRC tax evasion assistance requests double in five years

Corporate Tax HMRC tax evasion assistance requests double in five years

3m Emma Smith, Managing Editor
Spring Budget 2017: Making Tax Digital

Business Regulation Spring Budget 2017: Making Tax Digital

7m Shereen Ali, Deputy Editor
CGT clampdown nets HMRC £124m – but could lead to increase in use of avoidance schemes

Corporate Tax CGT clampdown nets HMRC £124m – but could lead to increase in use of avoidance schemes

3w Austin Clark, Reporter
‘Google tax’ nets HMRC £281m

Corporate Tax ‘Google tax’ nets HMRC £281m

1m Emma Smith, Managing Editor
OTS report: Corporation tax should follow accounts

Corporate Tax OTS report: Corporation tax should follow accounts

3m Alia Shoaib, Reporter