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EFRBS Settlement Opportunity

21st November 2013

HMRC has long held the view that EFRBS (Employer Financed Retirement Benefit Scheme) arrangements designed to trigger a Corporation Tax deduction without any taxable benefit arising to employees are not effective for tax purposes. It has announced that it is offering taxpayers which entered such arrangements before April 2011 the opportunity to settle enquiries without the need for litigation. HMRC is writing to relevant taxpayers, offering two main options: (1) disallowance of the corporation tax deduction for contribution to the EFRBS; or (2) payment of PAYE and NICs on contributions.

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Businesses with EFRBS arrangements have until 31 December to indicate that they wish to settle, and any settlement would have to be concluded by 30 June 2014.

Do you have an EFRBS? Are there open HMRC enquiries? Contact Katharine Arthur, head of tax, to discuss your options and to consider whether a settlement may benefit your business.

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