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June 2010 Budget: tax avoidance using employee benefit trusts
Practical Law UK Legal Update 0-502-5873 (Approx. 2 pages)
June 2010 Budget: tax avoidance using employee benefit trusts
by PLC Share Schemes & Incentives
| Published on 22 Jun 2010 • England, Wales |
A legal update about an announcement in the June 2010 Budget regarding tackling employment income tax avoidance arrangements using employee benefit trusts and similar structures.
The June 2010 Budget confirmed that the coalition government will introduce legislation with effect from April 2011 to tackle "arrangements . . . which seek to avoid, defer or reduce liabilities . . . to income tax and National Insurance Contributions or to avoid restrictions on pensions tax relief". The measure is aimed at arrangements which use employee benefit trusts (EBTs) and similar vehicles. This measure was initially announced in the March 2010 Budget (see March 2010 Budget: tackling tax avoidance using employee benefit trusts), but the June 2010 Budget report confirms that:
- Legislation will definitely be introduced and will take effect from April 2011.
- Employer-financed retirement benefits schemes (EFRBS) are within the scope of this proposal.
See paragraph 2.167, June 2010 Budget - Chapter 2 - Budget report and page 2 of June 2010 Budget - PN3 - Tackling tax avoidance.