The revelations that Ryanair pilots have become embroiled in tax avoidance schemes are just the latest in a long line of workers who signed up to be paid part of their salary through loan schemes which allowed them to take home 85% of their pay.
IT contractors, doctors, nurses, and even social workers were getting paid via schemes run by offshore companies such as AML which was based until recently in Isle of Man before moving to Panama in 2017 then shutting down.
The man behind AML was Glasgow born Doug Barrowman who says he spent considerable sums of money in taking tax advice and dealing with HMRC who did not regard the schemes as illegal tax evasion at the time they were set up.
More recently however legal challenges mounted by HMRC have proven successful and this has led to thousands of workers receiving large demands for unpaid tax.
It appears that the people who peddle the tax avoidance schemes are not normally pursued, but the individuals who took advantage of these schemes are gradually being identified and tracked down.
Now a group of MP’s are calling on the government to change the legislation back to making the schemes legal. However, this is a short sighted move and if some of the population were allowed to be paid 85% of their salary tax free then the Treasury could not possibly stand back and allow that to happen.
The Revenue say that promoters of tax avoidance schemes are rigorously pursued but the reality is that almost all of the schemes set up are closed down as the pedlars of the schemes move around offshore tax havens keeping their companies well away from the UK tax jurisdiction.