The judgment is perhaps a reflection of the current economic climate, and HMRC's success in this case is not a surprise.
This is bad news for the banks, as they will have to pay tax on employee bonuses which were paid out over a decade ago. It could also open the floodgates for HMRC to challenge other so-called tax avoidance schemes, which were perfectly legal when they were originally implemented.
UBS and Deutsche Bank may have to pay tens of millions of pounds to HMRC after the supreme court ruled that bonus schemes operated by the investment banks are not exempt from tax. The judgment, which covers bonuses paid out as far back as 2004, is strongly critical of the banks’ sustained attempts to escape payments due to HMRC. “In our society, a great deal of intellectual effort is devoted to tax avoidance,” said Lord Reed, delivering the ruling. They are “sophisticated attempts of the Houdini taxpayer to escape from the manacles of tax”.