Tackling anti avoidance: use of trusts
The measure
The March 2010 Budget announced action to tackle arrangements which sought to avoid, defer or reduce income tax and national insurance by using trusts and other vehicles to reward employees. The Government has confirmed that it is to continue with such measures. It was confirmed that employer financed retirement benefit schemes ('EFRBS', an unapproved pension arrangement) would fall within the scope of these rules.
Who will be affected?
Employers who use trusts and other vehicles to reward their employees.
When?
Any new legislation introduced is proposed to be effective from April 2011.
Although the Government has confirmed its intention to consult, review and take action to counter a specific area of perceived avoidance, it remains to be seen what form these changes will take and how extensive they will be. This will be an important area to keep under review.
