Skip to content


Employee Benefit Trusts: Rangers Applied

We reported recently on the landmark Supreme Court decision in the Rangers case. The expectation that the reasoning followed in the Rangers decision would follow through into other cases involving Employee Benefit Trusts (EBTs) using sub-funds in a similar manner has been borne out in the First Tier Tribunal decision involving three different but similar EBT in Landid Property & Others v HMRC.

The case involved a detailed review of the facts and, in the light of the Rangers decision, is unexceptional. It does illustrate, though, that the reasoning in Rangers will be applied by HMRC in challenging EBTs with sub-funds and also that arguments run by taxpayers seeking to distinguish Rangers are unlikely to succeed without relevantly substantive differences. Further, including artificial contingencies on the vesting of the amounts held in sub-funds (in this case, requiring the death of both Prince William and the President of the USA) will be disregarded by Courts applying a realistic view of the facts.

Companies and employees who have participated in EBTs with sub-funds who have not already settled with HMRC should reconsider their position. Further details on the terms on which HMRC will now consider settlement following Rangers are expected to be released shortly. 

Pett, Franklin & Co. LLP are experienced in negotiating settlements with HMRC and we seek to achieve the best possible outcome for taxpayers whilst bringing matters to a clear and final conclusion on all sides. To find out more about how we can help you or your client, please contact Stephen Woodhouse by calling 0121 348 7878.