BIG GROUP

[Bobo]

Indeed.

And of course, once you have settled, the scheme provider/trustees will demand all the loan back.....

Has any scheme provider demanded the loan back to-date?

If they have, isn't it cheaper to just pay the loan back and not pay the tax?

[regron]

Has any scheme provider demanded the loan back to-date?

If they have, isn't it cheaper to just pay the loan back and not pay the tax?

Maybe, but that depends on how much you owe. Many are in this for years worth of loans, so not feasible/affordable.

[Bobo]

I guess there may be some leeway if the loans are unsecured as opposed to secured against a fixed asset.

[DotasScandal]

These are not super-rich people who have dared to try things only allowed by the super-rich. They have to be humiliated.

Precisely.
There is a very large "punishment" component to this whole affair.
Punishment for what? Not "knowing our place", that's what!
You don't indulge in something reserved for members of the club without being a member of the club. End of.
We dared indulge in "tax avoidance", as plebs, and that, my friends, is our great sin.

Or so HMRC's political masters see us and our motives, in their warped, pathological class logic.

[BrilloPad]

Has any scheme provider demanded the loan back to-date?

If they have, isn't it cheaper to just pay the loan back and not pay the tax?

Yes

[webberg]

Has any scheme provider demanded the loan back to-date?

If they have, isn't it cheaper to just pay the loan back and not pay the tax?

No.

HMRC's position is that the loans represented income in the year drawn and the result is a tax liability - on you.

They say that repaying the loan will exempt you from the 2019 charge (as long as you never get the money back via another "tax avoidance" arrangement) but it doe not exempt you from the charge in the year the loan was drawn.

So the result is you pay the tax and repay the loan.

[Bobo]

Thanks Webberg



Please can you remind me/us of what the 2019 charge is. I believe it had something to do with having to pay IHT and penalties on the loan.

So are the options as follows?:

1.Settle now, by paying tax, interest and NI
2. Pay after the 2019 charge is implemented meaning I pay, tax, interest, NI and IHT
3. Join the BG and see where that goes.

On top of either of the 3 options the provider may still choose to ask for the loan repayment with interest

[webberg]

The 2019 charge is a tax on unpaid disguised remuneration loan balances.

It is income tax.

It may include NIC.

It does NOT include IHT.

It can avoided by repaying the loan (and not getting the money back via another tax avoidance scheme - whatever that is) or paying the tax due on the loan (whatever that is).

In response to the above.

1. If you settle now, certainly tax, interest (and NIC for post 2011 years).

2. Tax, NIC, yes. Interest and IHT, no.

3. BG - your choice - speak to us.

[Bobo]

Thanks Webberg

Trying to get a slot to speak to BG on Monday.

So interestingly, unless it's a typo, there is no interest in Option 2?
2. Tax, NIC, yes. Interest and IHT, no.

Does that mean the later you pay the better off you are?

[webberg]

Thanks Webberg

Trying to get a slot to speak to BG on Monday.

So interestingly, unless it's a typo, there is no interest in Option 2?
2. Tax, NIC, yes. Interest and IHT, no.

Does that mean the later you pay the better off you are?

Please read the whole thing in context.

If you settle with HMRC and pay tax now for a liability that was due at an earlier time, then interest is payable.

If you pay the 2019 charge on the loan balance for that earlier year, then if you pay the 2019 charge at the right time, no interest is due. You may however pay more tax perhaps (depends on circumstances).

It may also be the case that even if you pay the 2019 charge, HMRC will continue to chase the earlier liability.

One way of looking at the 2019 charge is that it's an APN on all those schemes that did not and cannot get an APN for whatever reason.