Court blocks Aberdeen AM bonus tax avoidance scheme

An offshore tax avoidance scheme used by Aberdeen Asset Management to pay its employees tax-free bonuses has been closed by Scotland's most senior court.

The FTSE-100 listed giant paid senior employees and directors over £31m free of income tax and National Insurance contributions between 2000 and 2003 using an Employee Benefit Trust (EBT). The Scottish Court of Session last week backed HM Revenue and Customs' (HMRC) argument that Pay As You Earn (PAYE) and National Insurance Contributions (NICs) should be paid on the bonuses, which were converted into shares under the complex scheme. The PAYE and NICs at stake in the case totalled £7m. This is the latest in a series of court rulings against businesses that have tried to avoid PAYE ...