Watch OldCo 'big tax case' live today and tomorrow

[pete 2,499]

Thornhill now finished but makes an important point when he heads off the enemy who earlier said they would submit WRITTEN points later. Thornhill says he wants to see the paperwork before it goes to the judges.

Not as blunt as that but he covered it well.

 

He also said they were adding evidence that was not used in the original case which I would have thought is not possible.

One other point I found interesting is that HMRC did actually take a charge for such benefits which means they knew about them and didn't consider them PAYE payable at that time.

[Darthter 542]

That's it all over. We await the result.

 

Scottish Mhedia already reporting probably next 48hrs

[BrahimHemdani 1]

So why use a fictional name rather than use one of the named staff members, is there a reason for this?

 

Because he's using it as an example in all manner of related cases not the Rangers case per se.

[BrahimHemdani 1]

He also said they were adding evidence that was not used in the original case which I would have thought is not possible.

One other point I found interesting is that HMRC did actually take a charge for such benefits which means they knew about them and didn't consider them PAYE payable at that time.

 

I think what he said was that they were making arguments not used before e.g. on PAYE, I am sure they cannot introduce new evidence. The case rests on:

 

Issues

 

1. Whether the Court of Session erred in law in reversing the specialist Tribunals below and concluding that payments of "emoluments" or "earnings", for the purposes of the Income and Corporation Taxes Act 1988 and the Income Tax (Earnings and Pensions) Act 2003, had been made by the appellant to its employees.
   
2. Whether, in order for a payment to constitute earnings for PAYE and NIC purposes, it is sufficient that the payment was "derived from" work done by a particular employee and/or it "it formed part of the employee’s employment package".
   
3. Whether the powers which each employee held as protector of a subtrust had the effect that the funds in that subtrust were unreservedly at the disposal of the employee and were earnings for PAYE and NIC purposes
   

.

 

Facts

 

Murray Group Management Ltd established a Principal Trust for the benefit of its employees and the employees of any group company including the appellant which entered into a deed of adherence. The appellant established a number of subtrusts for the benefit of their employees families. The appellant would pay a contribution to the Principal Trustee with a direction that a sub-trust be established and funded for a family of a particular employee. The employee was appointed protector of the subtrust, and the subtrust trustee would lend the employee money that had been advanced to the subtrust from his employer.

 

The Commissioners for Her Majesty’s Revenue and Customs determined that these payments constituted earnings for PAYE and NIC purposes and sought to impose charges to tax.

 

The First-tier Tribunal allowed the taxpayers appeals and held that no payment of earnings had been made. The Upper Tribunal refused the Commissioners appeal. On appeal, the Court of Session held that payments of earnings for PAYE and NIC purposes had been made by the appellant. It found that the payments made to the Principal Trustee, and in due course to the subtrusts, amounted to a re-direction of income.

 

The Court of Session granted permission to appeal to the Supreme Court on the question of whether the payments were earnings.

 

https://www.supremecourt.uk/cases/uksc-2016-0073.html

Edited March 16, 2017 by BrahimHemdani

[BrahimHemdani 1]

Scottish Mhedia already reporting probably next 48hrs

 

I think that's highly unlikely, it's a complex case and the judgement will be long and will take a good length of time to prepare.

 

However, almost certainly Lord Neuberger will be asking the others' opinions over a small sherry this afternoon and then someone will be charged with writing the (majority if that) opinion and there may also be a minority opinion as well.

[Darthter 542]

I think that's highly unlikely, it's a complex case and the judgement will be long and will take a good length of time to prepare.

 

However, almost certainly Lord Neuberger will be asking the others' opinions over a small sherry this afternoon and then someone will be charged with writing the (majority if that) opinion and there may also be a minority opinion as well.

 

I was joking....referencing that everything normally "happens" in the next 48hrs according to the mhedia

[colinstein 294]

based on nothing at all, I hope them judges have got the rolled up trooser leg and the funny handshake otherwise we're on to plums

[boabie 230]

As usual the whole world tax experts on every sellik forum put their own slant on things -

 

" In his last few sentences Mr Thornhill asked the court to reverse the Scottish Inner Court decision in respect of issues 1 and 2 but acceded to finding 3

The Chair responded to this key concession by asking him if this meant he was accepting that PAYE was due on the Sub Trustees individual funds

He said yes

Meaning Rangers accept that EBT holders must pay tax and NI on the funds deposited into their trust fund by Rangers. "

 

They see this as "Rangers" throwing their staff under a bus.

You would think that being so versed in all things financial these clowns would know that BDO are not acting on behalf of MIH, Murray, Rangers or its staff.

Also that those who did receive monies from such trusts have already been targeted thanks to actions at the last Budget Day and nothing is going to save them from having to pay. Mr Thornhill definitely would be aware of that.

[aweebluesoandso 290]

HMRC got a lot of leeway in the Court Of Session, adding new evidence and submissions they never used in the previous two, FTT and UTT tribunals. Thornhill wasn't at COS so this time he made a point about the HMRC additions, hopefully the SC agrees with him on this point.

[der Berliner 3,562]

It is again "interesting" to see how the Scottish mhedia snatches a line that suits their agenda and makes headlines of it that will stick in the net for eternity, yet are only the words and thus opnion of the HMRC lawyer ...

 

'Curious' £50m Rangers' player payments 'to avoid tax' were wages, court hears The Scottish Herald 15:10

Rangers paid £50m in loans to stars and staff 'to avoid tax' Daily Record 06:57

 

... and even go as far as making the whole article sound like fact, rather than the opinion of said chap.

 

Rangers paid £50m in loans to stars and staff 'to avoid tax' (<- headline as if it were fact)

 

The seven-year-old saga – known as the Big Tax Case – is being heard at the Supreme Court in London after oldco Rangers administrators BDO appealed an earlier court ruling in favour of the taxman.

 

Alan McEwen 06:00, 16 MAR 2017

 

Nearly £50million was paid to Rangers’ star players and senior staff through trusts just to avoid tax, the UK’s highest court heard yesterday.

 

BDO, administrators for Rangers oldco, are appealing against a ruling that £47.65million in “loans” made through employee benefit trusts (EBT) were really disguised salary payments.

 

The seven-year-old saga – known as the Big Tax Case – is being heard at the Supreme Court in London after BDO appealed an earlier court ruling in favour of the taxman.

 

Legal arguments in the case are expected to conclude today, but the court’s ruling may not be revealed for several months.

 

HM Revenue and Customs won an appeal at the Court of Session in Edinburgh in November 2015 over the now-outlawed EBTs.

 

The Scots judges ruled that any income from employees’ services is classed as earnings and subject to income tax. HMRC had previously lost two tribunals before the successful appeal.

 

The trusts benefited 80 players and staff at the Ibrox club between 2001 and 2010.

 

Among the EBT beneficiaries were former captain Barry Ferguson, who may be liable to repay £1million of £2.5million, Dutch legend Ronald de Boer, who may be on the hook for around £500,000 of £1.2million, and ex-manager Alex McLeish, who may be hit with a demand for £680,000 of £1.7million.

 

The team’s former owner, Sir David Murray, who received £6.3million, could end up being ordered to pay back £2.5million of that sum.

 

Julian Ghosh QC, representing the Advocate General for Scotland, told the hearing there was “a lot less to this case than meets the eye”.

 

Mr Ghosh said the court needed to ascertain “what was the reward payable by the employer to the employee as part of their bargain”.

 

He added: “There are two candidates in this case. The first is that the payment to the principal trust were payments of wages and they were paid to the principal trust trustees to avoid tax. No other reason, that was the reward.”

 

Ghosh said the “other candidate is that the relevant reward was the hope of a loan” through the trust.

 

The QC argued it did not matter where a payment was made “if that payment is made as a reward for my work done”.

 

The payments, he said, “simply replaced a cash bonus paid to them and they were told that the reason...was to avoid tax”.

 

Andrew Thornhill QC, representing BDO, said the issue was “what might be called a reduction of earnings”.

 

He added: “We submit you cannot reduce that to which you have no right.”

 

He explained the judges in November 2015 erred in law by finding you can have a reduction of earnings “even where there is no entitlement”.

 

Employees had “the possibility of being considered for a discretionary bonus”, he argued, but “prior to the decision being made by the employer, there was no entitlement on their part”.

 

The case relates to Murray Group companies, including the liquidated company RFC 2012 plc, and does not affect the current Ibrox regime.

 

The case is being heard by courtpresident Lord Neuberger, Lady Hale and Lords Reed, Carnwath and Hodge.

 

http://www.dailyrecord.co.uk/news/scottish-news/rangers-paid-50m-loans-stars-10035849