The question in this at First Tier Tribunal appeal was whether the appellant, M R Currell Limited, was liable to pay income tax under PAYE and national insurance contributions (NICs) relating to a payment of £800,000 which it made to the trustee of an employee benefit trust (EBT) in November 2010, and which the trustee lent to Michael Currell, a senior director and shareholder of the company at the time of the payment.

The purpose of the EBT was to reward and incentivise employees in the long term. The loan was consistent with this purpose and was a short-term measure. The relevant legislation does not tax the receipt of the capital of a loan used to purchase shares in a close company.