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Are your contractors using Employee Benefit Trusts?

Posted by Ifan | Posted in Agency, News | Posted on 20-09-2011

On the 9th of December 2010, HM Treasury released the Overview of draft legislation for Finance Bill 2011 announcing legislation targeting schemes to pay remuneration through Employee Benefit Trusts (EBTs).

The legislation will be introduced in the Finance Bill 2011, and become effective from 6 April 2011 onwards. The inclusion of anti-forestalling measures that became effective on the 9th December 2010 mean that from now payments of this type fall within the scope of the new measures.

The proposed legislation states that sums earmarked by trusts or other intermediaries will be treated as though it is a payment of income that is liable to PAYE tax.

Because of this ruling we believe that use of an EBT is no longer an option for your contractors.

If your contractors are using an EBT Company, then they should immediately consider their options as they have now been made a target by HMRC and with the wide ranging MSC legislation this could also prove risky for agencies who are continuing to use these services.

Be aware that EBT providers are trying to find a quick solution which could represent further danger!


How can Redego/Tempo Accounting help?

We will contact your contractors and give them a personalised assessment of their options and the likely impact on their take home pay within a few hours. Click here to request a call back.

The services that we can supply you, subject to your requirements, will all meet the criteria below;

  • No off-shore ‘tax avoidance schemes’; UK based services only
  • Either limited company or umbrella company services
  • No set up or leaving fees and no minimum contract period
  • Unlimited advice for contractors by specialist consultants and accountants covering many different technical aspects

Please call 0203 137 64 62 now for a free consultation.

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