Murray Group Holdings & Ors v Revenue & Customs [2012] UKFTT 692 (TC) (29 October 2012)

Murray Group Holdings & Ors v Revenue & Customs [2012] UKFTT 692 (TC) (29 October 2012)

The majority of the Tribunal held that the payments by the employer into the Remuneration Trust and the subsequent loans to employees did not constitute emoluments or earnings subject to PAYE and NIC. The arrangements were not shams or artificial steps to avoid tax, and the Ramsay doctrine did not apply. The trust and loan mechanisms were genuine, discretionary, and not contractual entitlements. Therefore, the appeal was allowed.

Citation
[2012] UKFTT 692 (TC)
Parties
Appellants: Murray Group Holdings and Others; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
29 October 2012
Procedural Posture
Tax Appeal / First Tier Tribunal (tax Chamber) Decision
Outcome
Appeal allowed
Legal Topics
Income Tax, National Insurance Contributions (nic), PAYE, Remuneration Trusts, Tax Avoidance Schemes, Employment Benefits, Loans to Employees, Ramsay Doctrine, Emoluments
Tax Law Employment Law Trust Law Income Tax National Insurance Contributions (nic) PAYE Remuneration Trusts Tax Avoidance Schemes +4 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 24 Party arguments 2 Amounts and remedies 7
Sign in to unlock

Parties

Murray Group Holdings and Others

Appellants

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal (tax Chamber) Decision

Legal Issues

  1. 1 Whether payments by employer into trust represent emoluments subject to PAYE and NIC
  2. 2 Whether benefits (particularly loans) derived by employees from the Remuneration Trust represent emoluments subject to PAYE and NIC
  3. 3 Whether the Ramsay doctrine applies to disregard the trust and loan arrangements as artificial

Ratio Decidendi

The majority of the Tribunal held that the payments by the employer into the Remuneration Trust and the subsequent loans to employees did not constitute emoluments or earnings subject to PAYE and NIC. The arrangements were not shams or artificial steps to avoid tax, and the Ramsay doctrine did not apply. The trust and loan mechanisms were genuine, discretionary, and not contractual entitlements. Therefore, the appeal was allowed.

Court Disposition

Appeal allowed

Orders

  • Assessments by HMRC set aside
  • No PAYE or NIC liabilities arise in respect of the trust payments and loans as emoluments