HMRC announces new settlement opportunity post-Rangers - KPMG United Kingdom
Share with your friends

HMRC announces new settlement opportunity post-Rangers

HMRC announces new settlement opportunity post-Rangers

HMRC has announced a new settlement opportunity in the wake of the Supreme Court decision in Rangers.



KPMG in the UK


Also on

The Supreme Court handed down its judgment in the Rangers case in July and, as we said at the time, the judgment has the potential to be so far-reaching, we hoped HMRC would issue guidance on how they intended to apply it.

The announcement of a new settlement opportunity is the first indication of how HMRC intend to proceed. As HMRC’s blog post states: “The decision makes it clear where a sum is established as being your employment earnings; you cannot avoid tax by diverting or paying them to someone else.”

The blog post continues: “The…decision impacts on a wide range of earnings-related tax avoidance schemes including EBTs, Employer-Funded Retirement Benefit Schemes (EFRBS), Contractor Loans 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 immediate action by HMRC, as well as reducing interest charges that would otherwise be payable and to giving access to extended payment terms, where these are needed.

“We will be issuing details of how to register and settle in the coming weeks….”

Readers will recall that HMRC previously ran settlement opportunities in this area (the EBT settlement opportunity or EBTSO and the contractor loan settlement opportunity or CLSO), both of which closed in 2015.

Anecdotal reports were that many participants in these types of arrangements adopted a wait-and-see approach and chose not to pursue a settlement. HMRC are no doubt hoping that Rangers is the key to bringing these participants to the table and finally resolving what has become a very long running saga.

It remains to be seen what settlement terms will be offered as part of this new opportunity. Given the sheer number of variants in types of arrangements, a one size fits all approach may not be possible. It’s also not clear how HMRC intend to apply Rangers to EFRBS cases given the decision in favour of the taxpayer in Ford v McHugh.

For those involved, the amounts will no doubt be material and, in light of the complexity of the existing legislation, planned future legislation and the arrangements themselves, we recommend participants seek professional advice.

Next Steps

Our specialist tax and legal teams have helped many employers and individuals participate in previous settlement opportunities. If you have any queries or need assistance, please do not hesitate to get in touch with your normal contact or e-mail

Connect with us


Want to do business with KPMG?


Request for proposal