UK: the taxation of 'disguised remuneration'

Draft legislation was published for comment last December in respect of arrangements intended to 'disguise' remuneration in order to avoid or defer income tax and/or national insurance contributions: see here (pdf). In response to comments received, HMRC has published FAQs and indicated where the proposed provisions require amendment: see here (pdf). In response to concerns about the effect of the proposed legislation on deferred rewards, the FAQ document states:

The policy intention is that the new rules should apply to arrangements involving a third party to reward employees and directors which seek to avoid, defer or reduce income tax and NICs and also to arrangements that are used as a tax‐advantaged way to save for retirement, using an employer financed retirement benefit scheme (EFRBS) as an alternative to, or to top up, savings in a registered pension scheme. However, it is not the policy intention that the new rules should apply to deferred rewards which are subject to a specified vesting date and on which income tax under PAYE and NICs will be due, particularly where the reward is subject to meaningful and time‐specific conditions which there is a realistic chance will not be met".