HMRC

An amount of £800,000 was paid to an Employee Benefit Trust (EBT), and a loan of the same value was subsequently extended to one of the directors of the appellant. The loan provided was a genuine one, backed by a legitimate obligation for repayment. At the time of the payment to the EBT, it was evident that the primary purpose was to enable the EBT to offer the loan to the director. Consequently, the question arises whether this loan should be considered a reward or benefit.

The answer to that question is affirmative; yes, it was a reward or benefit. The payment of the loan was made as a result of the director’s exertions. As such, the loan falls within the scope of Section 62 of the Income Tax (Earnings and Pensions) Act (ITEPA) and is deemed as earnings.

WIM Accountants are here to help businesses with their accounting and taxation needs.

ACCAWe are a member firm of Association of Chartered Certified Accountants

ACCAWe are a member firm of Chartered Institute of Taxation

London Office

37 New North Road
Ilford
IG6 2UE
Contact: 02082271700

Our Offices

East London     South London
West London    Cornwall
Bournemouth    Cardiff
Birmingham      Manchester
Nottingham       Stanmore
Ruislip              Harrow on the Hill
North London

Subscribe to Us


Office Hours
Monday        09:30 am - 17:30 pm
Tuesday       09:30 am - 17:30 pm
Wednesday  09:30 am - 17:30 pm
Thursday      09:30 am - 17:30 pm
Friday           09:30 am - 17:30 pm
Saturday      Closed
Sunday        Closed