Removal of a MAJOR reason to work at JPMorgan

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Rumour has it that one of the major draws to JPMorgan in London has disappeared: the tax efficient employee benefit trust.

According to headhunters, this trust lost its tax efficient features in January.

Allegedly, it was previously structured in such a way that employees were able to deposit around 30% of their total compensation in the trust and to borrow against it in a way that mitigated their exposure to UK income tax.

JPMorgan declined to comment.

Other banks are understood to have operated similar schemes, but many have been wound up in recent years. JPMorgan's is thought to have been one of the last.

"This was an incredibly well known scheme and worked strongly in favour of JPMorgan, both for retention and hiring purposes," claims the director of one search boutique. "They had a wholesale policy of allowing everyone who came in at a certain level to join the scheme."

"It was a big hiring point," agrees another.

John Whiting, a tax policy director at the Chartered Institute of Taxation, says the Inland Revenue has been aggressively stamping out employee benefit trusts which are used to reduce tax exposure.

"It's been the great battleground. The Revenue has been very aggressive, but organisations have continued to try work their way around the rules - the stakes are high and have got higher with the increase in income tax and national insurance," Whiting points out.

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