With tax planning schemes as with many things in life, what looks too good to be true generally turns out to be so. This seems to be true for tax avoidance schemes using Employee Benefit Trusts (EBTs) as during the summer HMRC won a landmark case at the Supreme Court against Glasgow Rangers Football Club concerning the payment of players and other employees via EBTs. Rangers had argued that the payments were not liable to PAYE and national insurance. The court has agreed with HMRC that the payments should have been treated as remuneration.

The government have been trying to block such schemes for many years with anti-avoidance legislation but various alternative planning strategies have been devised to sidestep the anti-avoidance rules.

As a consequence of the Rangers Supreme Court decision, HMRC are now pursuing employers who have used similar payment arrangements, including Employer Funded Retirement Benefit Schemes (EFURBS), and in appropriate cases will be issuing follower notices and accelerated payment notices to collect the PAYE, NICs, interest and penalties.