For years companies and individuals have attempted to avoid tax using disguised remuneration schemes i.e. tax avoidance schemes involving the payment of employees’ remuneration to a third party. HMRC’s consistent view that these schemes are ineffective was finally validated by the Supreme Court last year in the Rangers Football Club case (RFC 2012 Plc v Advocate General for Scotland). It appears inevitable that there will be an increase in liquidations and bankruptcies as a consequence of HMRC being given the green light to pursue years of unpaid tax.
Rachel and Jessica’s article gives an overview of disguised remuneration tax avoidance schemes, and considers possible recovery options. In particular, they have reviewed the likely merits of claims against directors brought under the Insolvency Act 1986, and have also addressed the potential for claims against third parties, with reference to the Court of Appeal decision in Barker v Baxendale Walker Solicitors.
The full text of the article is available here.
This material was first published by Sweet and Maxwell in Insolvency Intelligence, with the title “A Game of Two Halves: Petitions and Post-Winding Up Recoveries in Disguised Remuneration Tax Avoidance Cases” and citation Insolv. Int. 2018, 31(1), 22-27, and is reproduced by agreement with the Publishers.