BIG GROUP

[dammit chloe]

First, I think you are in the wrong place as this is Big Group which is looking for an answer that is not settlement.

Second, you need to do some reading on the threads below.

In order to settle you need to accept the HMRC calculation, sign a contract and make the payments.

Just "confessing" is not enough and HMRC will not do any of the work for you.

@webberg

Rather than take up time with phone calls as I know your offices are backed up for them. And please only answer if you feel it is ok too.

I have received my settlement offer of approx £70000 for approx 4 years in Horizon/CS and all my years are unprotected. last year was 2005/6, part year.

Is this scenario something that you have a clear, confident strategy for? Or as my years are all closed is the LCAG JR the only real hope?


Thanks in advance.

PS I did speak to your advisors but that was before I had a clear view on my situation and the responses were a little unclear. Hoping my actual circumstances help make things clearer.

[webberg]

If you have only closed (unprotected) years then a win for us at litigation means no tax for you.

Will we win?

No guarantee of that. We have a confidence level of 65%.

Speak to other advisers and they may be 65% sure that we'll lose. Speak to HMRC and they will be 100% sure we'll lose.

I cannot be any more clear.

In terms of a JR against the loan charge, I think we know of at least 4 going ahead of which LCAG is one.

Will they defeat the loan charge?

I don't know.

Every message from Government is that the loan charge is here to stay, but it would not a shock if they held the line until the last possible second and then caved as that seems to be what passes for policy for this Government (and the last one and all the ones before then).

[Clairol]

If you have only closed (unprotected) years then a win for us at litigation means no tax for you.

Will we win?

No guarantee of that. We have a confidence level of 65%.

Speak to other advisers and they may be 65% sure that we'll lose. Speak to HMRC and they will be 100% sure we'll lose.

I cannot be any more clear.

In terms of a JR against the loan charge, I think we know of at least 4 going ahead of which LCAG is one.

Will they defeat the loan charge?

I don't know.

Every message from Government is that the loan charge is here to stay, but it would not a shock if they held the line until the last possible second and then caved as that seems to be what passes for policy for this Government (and the last one and all the ones before then).

What are the other 3 JRS about please Graham?

[webberg]

What are the other 3 JRS about please Graham?

So far as we know they are promoter based groups who have been convinced that a JR will solve their issues.

The legal argument in each is similar and whilst I'm no lawyer I would have thought it would make sense for the best funded to move forward and the others to be stayed.

That would suit the promoter groups who have taken fees for this. They can then claim that being stayed is good tactics and if the better one is defeated, can make a claim that there is no point incurring more fees. What happens to the fees already paid? Who knows.

Remember, even if the loan charge was pulled tomorrow, you still have to deal with the liability on open years.

[Boodog]

So far as we know they are promoter based groups who have been convinced that a JR will solve their issues.

The legal argument in each is similar and whilst I'm no lawyer I would have thought it would make sense for the best funded to move forward and the others to be stayed.

That would suit the promoter groups who have taken fees for this. They can then claim that being stayed is good tactics and if the better one is defeated, can make a claim that there is no point incurring more fees. What happens to the fees already paid? Who knows.

Remember, even if the loan charge was pulled tomorrow, you still have to deal with the liability on open years.

Agree with this last point - and for some people pulling the loan charge might be disadvantageous imo...

[webberg]

Agree with this last point - and for some people pulling the loan charge might be disadvantageous imo...

Not sure how you get to that conclusion?

[Boodog]

Not sure how you get to that conclusion?

For those people with low income in 2018/19, compared to the years in which the loans were taken out, it might be a better option to pay the loan charge, then settle interest etc for open years. Rather than settle under current terms. If the loan charge is pulled then this narrows options surely.

[Delendog]

For those people with low income in 2018/19, compared to the years in which the loans were taken out, it might be a better option to pay the loan charge, then settle interest etc for open years. Rather than settle under current terms. If the loan charge is pulled then this narrows options surely.

But HMRC have stated that the LC does not close open enquiries and they will look at the open years and if the tax due is greater than that paid on the LC they will come after you. If it is the other way around they won't refund. Will they carry this out - who knows!

[Boodog]

But HMRC have stated that the LC does not close open enquiries and they will look at the open years and if the tax due is greater than that paid on the LC they will come after you. If it is the other way around they won't refund. Will they carry this out - who knows!

But I don’t think this means that they will do a comparison between settling and paying the loan charge - and make you pay the higher of the two. I think they will gross up the loans declared to account for scheme provider fees, then calculate interest and NICs - so there will be an additional amount to pay, to finally settle.

[webberg]

But I don’t think this means that they will do a comparison between settling and paying the loan charge - and make you pay the higher of the two. I think they will gross up the loans declared to account for scheme provider fees, then calculate interest and NICs - so there will be an additional amount to pay, to finally settle.

That's not how it works.

Let's assume that a loan was made in 12/13 of £50,000. Other income that year was £30,000. Income in 18/19 is nil.

(By the way this is a very unusual pattern).

Tax in 12/13 - no loan is approx £4,200.
Tax in 12/13 with the loan is approx £22,000

Tax in 18/19 - loan only is £8,360.

Loan charge is paid.

Later 12/13 is agreed.

You will owe £22,000-£4,200-£8,360 = £9440 plus interest