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 found that the payments into the remuneration trust and the subsequent loans to employees did not constitute emoluments or earnings from employment subject to PAYE and NIC. The arrangements were not artificial or a sham, and the Ramsay doctrine did not apply to disregard them. The trust and loan structure was effective, and the appeal was allowed.

Citation
[2012] UKFTT 692
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) Decision
Outcome
Appeal allowed
Legal Topics
Income Tax, National Insurance Contributions (nic), PAYE, Remuneration Trusts, Tax Avoidance, Employment Benefits, Loans to Employees, Ramsay Doctrine
Tax Law Employment Law Trust Law Income Tax National Insurance Contributions (nic) PAYE Remuneration Trusts Tax Avoidance +3 more

Case Brief

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Parties

Murray Group Holdings and Others

Appellants

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal (tax) Decision

Legal Issues

  1. 1 Whether payments by employer into a remuneration 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 found that the payments into the remuneration trust and the subsequent loans to employees did not constitute emoluments or earnings from employment subject to PAYE and NIC. The arrangements were not artificial or a sham, and the Ramsay doctrine did not apply to disregard them. The trust and loan structure was effective, and the appeal was allowed.

Court Disposition

Appeal allowed

Orders

  • Assessments for PAYE and NIC set aside
  • No liability for PAYE or NIC arises in respect of the trust payments or loans as structured