HMRC Loan Charge Update: £1 billion of agreed settlements
18 February 2019
- HMRC advise loan scheme users to come forward even if they cannot afford to pay
- HMRC will not force anyone to sell their main home to pay their debts
- HMRC has recovered £1 billion of tax since the loan charge was introduced
On 14th February HMRC published an updated version of their briefing: Disguised remuneration on loans. HMRC have now stated that if an individual is expected to have taxable income of less than £30,000, they can arrange repayments over a time period of up to seven years without the need to provide financial proof.
Interestingly, HMRC has recovered £1 billion of tax through the loan scheme with 85% of the amount being collected from the employer.
The loan charge comes into force on 6th April 2019 and will treat any outstanding loans as taxable income.
Aspire Comment
This update details some easement in the process that HMRC are following to recover the tax due on income treated as loans. This comes in the face of bad publicity where the actions of HMRC are reported to have been contributory factors in the suicide of some individuals.
To read Aspire’s previous news articles on the loan charge published during the last year, follow these links;
17.01.19 Spotlight 46 – GAAR panel publishes opinion on loan schemes
19.07.18 Loan Charge settlements can be repaid over 5 years
05.06.18 HMRC extend deadline for settling to avoid the 2019 Loan Charge