The greater risk

In 2001 the taxpayer’s employer promised him 9% of the shares in the holding company of the group.

Before he could fulfil this the owner died but his father made good the promise and in 2002 the shares were put into an offshore trust for the benefit of the taxpayer’s children.

The taxpayer declared income from the trust in three tax returns. HMRC opened an enquiry and assessed him to tax of £2.7 million on the basis that the shares were equivalent to employment income equal to the market value of the shares.

The taxpayer appealed but this appeal had not been heard by the time of the instant proceedings.

In November 2008 HMRC went to the High Court to enforce the debt. The taxpayer paid £100 000 on account. In March 2009 he applied under

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