HMRC Warn Against Loan Charge Avoidance Schemes

Posted by on May 20, 2018 in News Alerts, Newsletters | No Comments

At CooperFaure, we have received the following notification from HMRC on arrangements aimed at getting around the upcoming 2019 Loan Charge for individuals in Disguised Remuneration Schemes.

“HMRC is aware of a number of arrangements being promoted which claim to enable users to escape the 2019 loan charge. HMRC’s view is that these arrangements do not work and users are advised not to sign up to them. While promoters claim that these arrangements work, users should be clear that HMRC does not agree. Any arrangements to avoid the loan charge, which seek to deceive HMRC as to what is really happening, may be fraudulent.”

“A number of previous cases promoted as being compliant and legal have resulted in criminal convictions for the key people involved and extensive investigation of several hundred users. HMRC will investigate all of these arrangements and is likely to take similar action if it finds any that are seeking to deceive. At the very least, anyone who takes part in an offensive arrangement is likely to face penalty sums, chargeable along with any tax and interest that will be due.”

“Tax avoidance doesn’t pay. Most arrangements simply don’t work and people can end up paying more than they were trying to avoid. Users may have a long-term requirement to deal with the cost, commercial and tax fallout from these transactions with no support from the promoter of the original arrangement. If users are worried about their financial position, it is better to contact HMRC rather than risk more investigation and what is likely to be a larger bill.”

We at CooperFaure endorse the HMRC view on this matter and would counsel anyone who has received loans under a Disguised Remuneration Scheme to take advantage of the current settlement opportunity.

The deadline to register your interest is 31st May 2018.  If you are not already in discussions with HMRC, this can be done by email with them either to cl.resolution@hmrc.gsi.gov.uk for contractor loan schemes or ca.admin@hmrc.gsi.gov.uk for all other disguised remuneration schemes.

The deadline to submit the required information to HMRC is 30th September 2018.

If you would like to arrange an initial consultation that is free and without obligation to discuss your circumstances, please email us at tax@cooperfaure.co.uk.