The scheme was used by an owner-manager of a limited company.
The opinion notes “owner managers have a variety of options available but usually extract value from their companies in the most tax efficient way. The fact that tax consequences are considered does not automatically make the means adopted contrived” (para 10.1).
The company argued that the arrangements applied to the owner manager in his capacity as shareholder and not as director. The Panel considered this was irrelevant as the payment related to his office.
The opinion, with an explanation of how the scheme was supposed to work, can be found at https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/913021/GAAR_Advisory_Panel_opinion_of_7_April_2020_-_Rewards_in_the_form_of_loans_for_employees_including_contributions_to_a_trust_-_Individuals.pdf. [20.07/13]