can I contact HMRC to settle

[starstruck]

Assuming you were a 40% tax payer in all those years, and don't have any Open years, then you might as well wait for the 2019 loan charge. That's how I read it anyway, i.e. there is no financial benefit to making a voluntary payment now.

Firstly ... I doubt anyone would have been a 40% taxpayer whilst on a scheme. I would imagine all received minimal salary and then loans.

Secondly ... loan charge includes NI (and who knows what else as it isn't clear) and settlement doesn't.

*If* the settlement is *truly* settlement then I believe it is meaningfully less money for people with closed years.

Although why settle when loan charge is still unclear?

[ConfusedEasily]

Firstly ... I doubt anyone would have been a 40% taxpayer whilst on a scheme. I would imagine all received minimal salary and then loans.

Secondly ... loan charge includes NI (and who knows what else as it isn't clear) and settlement doesn't.

*If* the settlement is *truly* settlement then I believe it is meaningfully less money for people with closed years.

Although why settle when loan charge is still unclear?

So here's the accountant's Lawyers view.

Unless HMRC agrees 100% with the settlement amount and is prepared to write this in a manner that would be acceptable in a court of law it is worthless.

The 2019 charge shows that even when HMRC state that a year is closed it is in fact not.

As it has exceeded the requirements for record keeping, HMRC may have to evidence any demands they make. The lawyer expects that the legislation will have to allow them to make an estimate as otherwise it is unlikely that they will be able to issue a demand.

Potential legal costs for kicking off ar prohibitive so I'll have to just wait for the demand. The Lawyers says that a settlement before legislation is pointless.

Finally, the Lawyer told my accountant that given a recent Supreme Court decision there is a strong argument that the Employer (an investment bank) is actually liable for the tax, although after 4 years how HMRC would plan to collect it is a moot point.

Am I in the twilight zone????

[MyxALot]

Potential legal costs for kicking off ar prohibitive so I'll have to just wait for the demand. The Lawyers says that a settlement before legislation is pointless.

Finally, the Lawyer told my accountant that given a recent Supreme Court decision there is a strong argument that the Employer (an investment bank) is actually liable for the tax, although after 4 years how HMRC would plan to collect it is a moot point.

Am I in the twilight zone????

No, but you are several months behind the times and this month in particular has a lot of news in this area.

Suggest you look into Big Group for assistance with both points above. If you have a liability under the 2019 Loan Charge it will definitely be worth your time and money.

[ChimpMaster]

Doesn't look like the new settlement terms are in any way generous:

From: https://www.gov.uk/government/public...ttlement-terms

You’ll need to pay:
Income Tax on the net amount of all disguised remuneration loans or payments made - this will be calculated using the bands and rates in the years the loans or payments were made
late payment interest for any years where HMRC has an open enquiry into your tax affairs, is within time to open one, or an assessment is in place
National Insurance contributions (NICs), if you’re a self-employed contractor, including through partnerships
any penalties and Inheritance Tax, depending on your circumstances

[ChimpMaster]

If you have not received a letter from HMRC advising of a Discovery or Enquiry, is there any other way to check for sure that none of your tax years are "open" or "protected" by HMRC?

Without having to call them, of course.

[webberg]

If you have not received a letter from HMRC advising of a Discovery or Enquiry, is there any other way to check for sure that none of your tax years are "open" or "protected" by HMRC?

Without having to call them, of course.

Not really.

Call them. If you genuinely have had nothing, then you have nothing to fear.

I do not beleive in conspiracy theories that say HMRC will make up an enquiry opener.

[ChimpMaster]

Not really.

Call them. If you genuinely have had nothing, then you have nothing to fear.

I do not beleive in conspiracy theories that say HMRC will make up an enquiry opener.

I'd rather not give them the opportunity! And that's the problem.

[starstruck]

I have a vague recollection of someone saying you could login somewhere to see. I guess it may be the government gateway or something like that.
EDIT - this maybe? https://www.tax.service.gov.uk/gover...origin=unknown

[flamel]

I have a vague recollection of someone saying you could login somewhere to see. I guess it may be the government gateway or something like that.
EDIT - this maybe? https://www.tax.service.gov.uk/gover...origin=unknown

"I have a vague recollection......"
LOL

[HMRC made Atlas Shrug]

The main issue with IHT is that even HMRC's IHT office are a bit unsure a) if IHT applies and b) who it applies to. the general consensus is that for the standard EBT, IHT will apply. But, the last time I looked at this (via the Tax Advisory I used to negotiate my settlement), the opinion was that the charge fell on the Trustee (which made life hard for us as the Trust won't write off the loans because they don't want to pay the IHT).

Its complicated though as it relies on the way the original trust was set-up, so whats true for one EBT, may well be very different for another EBT..

One thing that confuses me about your case though - HMRC was offering to write off your loans? or offered that as an option?? How did that work? considering that the only person able to do that was the Trustee and HMRC has absolutely no say in that aspect..

"Its complicated though as it relies on the way the original trust was set-up, . . . "

This may be of interest to you. I was informed the trust I belonged to is a 'section 86' Trust which carries an IHT exemption. I put it to HMRC and this is their response.

"It is true that relief from Inheritance Tax under s70(3) can be and has been given on the income payment made into the trust, however tax is also payable on any capital assets which leave the trust. This is not double taxation as statutory charges arise both on entry and on exit from a trust."

My thoughts on this is, what assets are HMRC talking about ? I received an "income" (according to HMRC) on which I paid PAYE. HMRC redefined my loans as income therefore, there was never any loans.

Following on from that I would say there therefore also was never a Trust. I found a case on the internet where HMRC successfully proved in court a Trust was not a Trust, so its been done before. Food for thought.
At the end of the day, this section 86 seems like just another one of HMRC's own rules HMRC is ignoring.

"HMRC was offering to write off your loans? or offered that as an option?? How did that work? "

My apologies if I did not make myself clear, that is why we go back to clarify the requirements.

The best way to explain is to show what HMRC put in their own documents. Since HMRC refused to tell me if IHT will apply if I had my loans released, the only option left was to go on what HMRC put in their own settlement agreement.

This is in a paragraph under the heading (in bold) "Inheritance tax".
"If you are intending to have the loan written-off as part of the settlement, please let me know on the enclosed Settlement Options form (CL5a)."

I chose this option on the (CL5a) 'Contractor Loans Legacy Settlement Options' document.
"I intend to have the loans written-off as part of the settlement".

I then had my loans released.

There are other points in HMRC's settlement agreement where it clearly states IHT is included in their settlement agreement.