A payment arising under a tax avoidance scheme was an income distribution of the appellant, who in the alternative was a ‘settlor’ of a ‘settlement’ under the settlements anti-avoidance provisions.

Summary

A payment arising under a tax avoidance scheme was an income distribution of the appellant, who in the alternative was a ‘settlor’ of a ‘settlement’ under the settlements anti-avoidance provisions.

Background

The appellant was party to tax avoidance arrangements designed to allow shareholders in private companies to extract profits from those companies without paying income tax thereon. 

There were three main elements to the scheme: (1) The creation of a new class of ‘S’ shares and the issue of a share in that new class to a non-resident individual; (2) The transfer by the non-resident individual of that share to a Jersey