Rangers FC

[Alan @ BroomeAffinity]

Excellent. Can't wait for the offshore guys to start bombarding this board extolling the greatness of their schemes. They maybe aren't scams but they are undeniably shams. They are also very difficult to defend morally. I find the fact that millionaire footballers are avoiding tax in this way odious in the extreme.

[captainham]

Vallah, sign me up to your scam scheme, I'm in.

[Vallah]

thanks Prozak -- so under what situation would the load be repaid - do you know if this has ever happened? the consensus seems to be that it wouldnt be in the interest of the beneficiary to repay the loan and so the trust will never ask for the loan to be repayed..?

If you read the judgement in the case at the following link

http://www.financeandtaxtribunals.go...51/TC02372.pdf

the tribunal concludes that even though the loan doesn't appear to be very commercial, and even though the trustees in nearly all cases comply with the employer's wishes exactly, they are still legally loans, and therefore NOT income. Another massive bit of case law in defence of EBTs, to go with all the rest.

[slogger]

they are repayable. They are even repayable on demand.

The loans are usually rolled over. If you don't roll over you can either repay the loan or the trustee treats it as a disbursement from the trust with all the reporting and tax implications.



No. There is a loan agreement. Like all loan agreements there are rights for each party. Some of those give the right of the trust to request the loan repaid.

thanks Prozak -- so under what situation would the load be repaid - do you know if this has ever happened? the consensus seems to be that it wouldnt be in the interest of the beneficiary to repay the loan and so the trust will never ask for the loan to be repayed..?

[prozak]

If its a loan then it should be repayable, else its a gift?
i.e. under what circumstance would the loan ever be repayable?

they are repayable. They are even repayable on demand.

The loans are usually rolled over. If you don't roll over you can either repay the loan or the trustee treats it as a disbursement from the trust with all the reporting and tax implications.

but if the trustees don't ask for the money back HMRC will treat it as a gift and gifts can be taxed.

No. There is a loan agreement. Like all loan agreements there are rights for each party. Some of those give the right of the trust to request the loan repaid.

[eek]

I think the BBC Scotland business correspondent is entirely mistaken. The loans are from a trust, and not the company which owes the money. The only people who can recover the loans are the trustees, and as we know, they have to act in the best interests of the beneficiaries.

but if the trustees don't ask for the money back HMRC will treat it as a gift and gifts can be taxed.

[slogger]

I think the BBC Scotland business correspondent is entirely mistaken. The loans are from a trust, and not the company which owes the money. The only people who can recover the loans are the trustees, and as we know, they have to act in the best interests of the beneficiaries.

If its a loan then it should be repayable, else its a gift?
i.e. under what circumstance would the loan ever be repayable?

[Vallah]

and



Means there is going to be an incredibly uncomfortable time for all those paid in this way now... Unless the creditors don't chase them for the money back. Either way, hardly a result for anyone that is using an EBT to happy with surely. Might prove if you spend millions your LTD might get away with using it but you will become personally liable to pay the money back at some point?

I think the BBC Scotland business correspondent is entirely mistaken. The loans are from a trust, and not the company which owes the money. The only people who can recover the loans are the trustees, and as we know, they have to act in the best interests of the beneficiaries.

[northernladuk]

The legal effect of the trust/loan structure is sufficient to preclude this. Thus the payments are loans, not earnings, and so are recoverable from the employee or his estate."

and

BBC Scotland's business correspondent David Henderson said the implications of the tax ruling were that "all those footballers who were playing for Rangers, happily being paid using these EBTs, may well get a letter in the post soon, saying 'give the money back to the liquidators, for onward transfer to the creditors'."

"That could include Sir David Murray, who allegedly took about £6m through this scheme."

Means there is going to be an incredibly uncomfortable time for all those paid in this way now... Unless the creditors don't chase them for the money back. Either way, hardly a result for anyone that is using an EBT to happy with surely. Might prove if you spend millions your LTD might get away with using it but you will become personally liable to pay the money back at some point?

[SimonMac]

I found this interesting or am I posting old news?

BBC News - Former Rangers Football Club wins Big Tax Case appeal

There is a free for all in General with the usual sectarian biases (myself included) so it might be worth while asking the mods to let this one stay if you want to talk about the merits of EBT's

[BenDover]

I found this interesting or am I posting old news?

BBC News - Former Rangers Football Club wins Big Tax Case appeal