The Court of Appeal upheld the Upper Tribunal’s decision that the First-tier Tribunal erred in law in deciding that a payment of earnings had arisen from arrangements involving the taxpayer company making a payment to an employee benefit trust, which then loaned the same amount to a director and shareholder.
Summary
The Court of Appeal upheld the Upper Tribunal’s (UT’s) decision that the First-tier Tribunal (FTT) erred in law in deciding that a payment of earnings had arisen from arrangements involving the taxpayer company making a payment to an employee benefit trust (EBT), which then loaned the same amount to a director and shareholder.
Background
A director and shareholder (MC) of the taxpayer company (MRC) established a sole trader business in the early 1980s, which 
