Do you worry that  your arrangements may be subject to the Loan Charge?

The original ‘Disguised Remuneration Rules came into force on 9 December 2010. The Loan Charge was announced at Budget 2016 to tackle disguised remuneration tax avoidance schemes, which paid income in the form of loans that were not taxed or subject to National Insurance contributions. 

The Loan Charge, as originally enacted in Finance Acts (No. 2) 2017 and 2018, applied to any loans taken out on or after 6 April 1999. It taxed any loans outstanding on 5 April 2019 as income for the 2018 to 2019 tax year. Taxpayers were not liable to the Loan Charge if, by 5 April 2019, they repaid the loans, or settled with HM Revenue and Customs (HMRC) to pay all relevant tax liabilities and National Insurance contributions on the loans.

Following the Loan Charge Review carried out carried out by Sir Amyas Morse, the Government accepted recommendations, including:

·       Limiting the scope of the Loan Charge to loans taken out on or after 9 December 2010;

·       That the Loan Charge should not apply to loans taken out between 9 December 2010 and 5 April 2016 where the individual had fully disclosed their use of the schemes to HMRC, and HMRC had failed to take action (for example, by opening an enquiry);

·       Allowing taxpayers to benefit from spreading their loan balances evenly over three tax years, instead of taxing the full amount in a single year.

If you need a confidential discussion about your arrangements, contact us for a no obligation consultation today.

We can help you deal with any tax investigation through expert advice and specialist representation. Our team deals with matters ranging from individual tax disputes to large and complex multiple client cases. 

• Formal and Informal Notices
• Compliance Checks
• Penalty Notices
• Discovery Assessments
• Voluntary Disclosures to HMRC
• Accelerated Payment Notices (APNs)
• Code of Practice 8 – CoP 8 Investigations
• Code of Practice 9 – CoP 9 Investigations
• Contractor Loan Schemes and the Loan Charge
• DOTAS/POTAS Inquiries
• PAYE Tax Investigations 

• Corporation Tax Investigations
• IR35 Disputes
• VAT Investigations and Inspections
• HMRC Unannounced Inspections and Visits
• Settlements with HMRC
• Time to Pay Arrangements
• Statutory Reviews
• Forensic Tax Advice
• Tax Litigation Advice
• Corporate Advisory
• Private Client Advisory