Employment Taxes


Clause 7 of the Finance Bill 2016 reverses the decision in HMRC v Apollo Fuels, B Edwards and others [2016] EWCA Civ 157 (17 March 2016). In the Apollo Fuels case the Court of Appeal found that the lease of a car to an employee who paid lease charges at full market value was not a taxable benefit.

HMRC provide a communications document on PAYE Penalties.

Buoyed by HMRC’s recent victory in the Court of Session against Glasgow Rangers’, the Chancellor of the Exchequer struck a further blow against Employee Benefit Trusts (EBTs) in his March Budget.  Amongst a number of anti-avoidance measures, he announced that legacy loans to employees and former employees made by EBTs before the Finance Act 2011 rules on ‘disguised remuneration’ came into play will now be judged offside and subject to a new PAYE (and NIC) charge if still outstanding on 5 April 2019. 


The Apprenticeship Levy was announced at Summer Budget 2015 and will be introduced from 6 April 2017. The Levy will be charged at a rate of 0.5% of an employer's total pay bill for Class 1 NIC purposes. Each employer will receive an allowance of £15,000 to offset against their Levy payment, the intention being that the Levy will only be payable on pay bills in excess of £3 million a year. 

The CIOT has commented on the draft clause published on 2 February 2016 (and updated on 5 February to correct typographical errors) to be included in Finance Bill 2016 to introduce the new deemed domicile rules for income tax and capital gains tax. The new rules will take effect from 6 April 2017.

On Wednesday 24th February 2016: 14:00 – 14:45, HMRC are talking about Debt Management and Banking Migration. This session is primarily aimed at agents that have clients abroad that pay by any means (BACS, CHAPS, or cheque/all payments). This will include a look at the background to migration (why, when, how, etc.), the successes, what it means to you and your clients and the ‘how to pay HMRC’ gov.uk changes.

The CIOT comment sent to HMRC 9 February 2016 on Employer provided living accommodation.

The government published in December 2015 draft legislation to tax the income from sporting testimonials granted to employed sportspeople, but with a limited exemption of £50,000 for payments from qualifying testimonials.



The pension lifetime allowance (LTA) for funds held in an approved pension scheme is to be reduced from £1.25m to £1m from 6 April 2016. It is also proposed that from April 2018 onwards the LTA will increase in line with the consumer prices index (CPI).

Draft Finance Bill 2016 Clause 11 amends the tax treatment of unapproved employee share schemes. The main effect is that Restricted Stock Units (RSUs) awarded to Internationally Mobile Employees (IMEs) are taxed under the rules that deal specifically with Employment-Related Securities (ERS) rather than those dealing with earnings generally.