Tax warning for IFAs on commission rebates

Intermediaries who rebate commission on offshore bonds could be putting their clients in line for a tax bill from HM Revenue & Customs (HMRC). Scottish Life International (SLI) is warning IFAs that HMRC may judge such an action to be a tax avoidance scheme, especially if they are putting clients into cash bonds and then cashing them in very shortly afterwards. While HMRC allows for commission to be rebated back to the client tax free, Gerry Brown, technical manager at SLI, warned against abusing the spirit of this. He noted in such cases HMRC would be likely to charge a 15% tax on the reb...