US bank JPMorgan is nearing a £500 million settlement with the UK government that would pay back taxes avoided through the use of an offshore trust for bonus payments, according to the Financial Times.
The bank is winding up the Jersey-based arrangement and has asked more than 2,000 current and former employees to contribute towards the settlement, according to the paper.
Trust schemes allow companies and employees to avoid national insurance contributions and income taxes. JPM's scheme had operated with the knowledge and authorisation of the UK tax authorities, but the government is now clamping down on the use of such trusts.
The FT said that estimates the amount held in JPM's trust at between £2 billion and £9 billion, suggesting a tax bill of at least £1 billion, but that the deal with the government is understood to represent around half that amount.
JPM did not comment on the specifics of the case to the paper, but said: 'Our employee trust has always been transparent ... and its independent trustee has consistently paid taxes in accordance with UK tax law.'
The Treasury declined to comment.