Last month the Supreme Court released a decision in the Rangers Football Club case and agreed with HMRC that there had been a payment of earnings to both the footballers and executives of the football club. As a result, the club should have deducted income tax and NI from the sums they paid into an Employee Benefit Trust (EBT).

The decision makes it clear that where a sum is established as being part of your employment earnings, you cannot avoid tax on them by diverting or paying them to someone else. The Supreme Court's decision is very relevant to a wide range of earnings-related tax avoidance schemes including EBT's Employer-Funded Retirement Benefit Schemes (EFRB), Contractor Loan schemes and self -employed benefit schemes - known collectively as disguised remuneration (DR) schemes.

As a result of the Supreme Court ruling, HMRC will be inviting participants of DR schemes to register an interest in settling their tax liabilities arising from the use of these arrangements. Settling will prevent further action by HMRC.

For further information about this particular case, please click here: