• The General Anti Abuse Rule (“GAAR”) panel has given its opinion on two recent cases where employees were paid via loan schemes
• One case involved a contractor and the other an employee. The arrangements included use of loans and the transfer of creditor rights into an Employer Financed Retirement Benefits Scheme (EFRBS)
• In both cases, the individual was employed by a trust which paid them a small wage along with much larger loans which were not reported as taxable income
• The GAAR panel decided that there was no reason for the arrangements to be structured in that way other than to seek a tax advantage
• Transactions entered into after 14 September 2016 which fall foul of the panel’s opinion could be subject to 60% GAAR penalty where GAAR applies

Minden U.K. Limited use Aspire Business Partnership LLP. This firm provide Minden U.K. Ltd with practical and commercially sound advice in relation to all aspects of compliance, business strategy and conflict resolution. Original article can be found on Aspire’s website:

https://www.aspirepartnership.co.uk/News/3245/spotlight-46-gaar-panel-publishes-opinion-on-loan-schemes