HMRC announced a time-limited opportunity to resolve a long-standing dispute over a scheme designed to reduce Income Tax and National Insurance liabilities on employer-provided accommodation.

The scheme involved the use of lease premium arrangements by employers to provide living accommodation to employees with the intention of minimising the tax and National Insurance charge on the benefit of the accommodation. The accommodation was often provided via an Employee Benefit Trust (EBT) or similar entity.

HMRC has challenged such arrangements and legislation was introduced in Finance Act 2009 to “put beyond doubt” that the arrangements were ineffective.

Employers or employees using the arrangements before the change in legislation are invited to indicate their willingness to reach a financial settlement with HMRC to resolve the issue.

Further information on the announcement and details of the proposal for settlement are available at http://www.hmrc.gov.uk/news/lease-prem-sett.pdf and http://www.hmrc.gov.uk/news/lease-prem-sett-qa.pdf