The outrageous £50M tax scheme that was KC-approved

Can someone from UK explain this to me.

A company is owned by a Philippine director and is claiming employment benefit. How? They are also paying vat at a flat rate.

Does this article mean to say the following?

1. Company is created and director from Philippines appointed. 2. Company gives service to someone and employs (or Does not even employ someone?) A person and claims deduction in income tax. 3.??? 4. Profit ?

An example with numbers.

Company A provides service for £10,000.00 and pays 6% vat. So £600 during a year.

They employ 2 people and pay them £5000 Net profit is £5000. 20% tax so net profit after tax is £4000.

Question 1. Is first txn with 10k income and 600 tax received/dsposited in bank? question 2. Was someone paid 5000 in their bank account? Question 3. Was 1000 tax paid?

I come from Indian tax jurisdiction so this scheme sounds plausible way of funneling "black cash" into coffers and people do this regularly so I's it bad exactly how?

"KC" being King's Council, which in the UK legal system is a person who is a very expensive highly qualified lawyer who act in cases in the higher courts. They were called Queen's council until the Queen died.