More Uncertainty

AMANDA FLINT and CATHERINE MEEK of Chiltern plc look at the draft anti-avoidance legislation on employee securities to be included in the Finance Bill 2005.

THE TECHNICAL NOTE issued by the Inland Revenue on 2 December 2004 following the Pre-Budget Report outlined measures designed in the words of Dawn Primarolo to 'ensure that all employees and employers pay the proper amount of tax and National Insurance contributions on the rewards of employment'. Draft legislation to be included as Schedule 1 to the Finance Bill 2005 which gives effect to the new measures by amending Part 7 of ITEPA 2003 was published on 4 February 2005.

All the indications are that the genesis of these changes to the legislation is the Disclosure of Tax Avoidance Schemes Regulations 2004. For many years there has been a cat and mouse game between advisers and the Inland...