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What is the 2019 Loan Charge?

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    Settled but still subject to the Loan charge?

    [QUOTE=webberg;2526878]So if you go into CLSO 2 and have a written contract, how far are you prepared to back "this is incorrect" when you have nothing in writing?

    If the rules of the DR charge said that a loan subject to CLSO would not be taxed again, I'd completely agree with you.

    I can't see that they do.

    Remember that the CLSO 2 is outside the legislation. It's a concession offered by HMRC. So ultimately you're looking to have a statutory charge, defined in legislation, removed by application of a non statutory payment. I want any of my clients in this situation to have a written statement that they will not be taxed twice because I think HMRC have proven themselves unworthy of trust here.

    If you want to rely on common sense, I admire your capacity to trust HMRC.[
    /
    QUOTE]

    Can I just clarify? If I am to proceed to settlement, which I'm considering, HMRC might still come after me with the 2019 Loan Charge?

    Comment


      [QUOTE=MK59;2527991][QUOTE=webberg;2526878]So if you go into CLSO 2 and have a written contract, how far are you prepared to back "this is incorrect" when you have nothing in writing?

      If the rules of the DR charge said that a loan subject to CLSO would not be taxed again, I'd completely agree with you.

      I can't see that they do.

      Remember that the CLSO 2 is outside the legislation. It's a concession offered by HMRC. So ultimately you're looking to have a statutory charge, defined in legislation, removed by application of a non statutory payment. I want any of my clients in this situation to have a written statement that they will not be taxed twice because I think HMRC have proven themselves unworthy of trust here.

      If you want to rely on common sense, I admire your capacity to trust HMRC.

      Can I just clarify? If I am to proceed to settlement, which I'm considering, HMRC might still come after me with the 2019 Loan Charge?
      Well, two professionals here say not. I say I'm not so sure.

      I'm going back to look at the rules again.

      My issue is that the rules as written apply a relief from double taxation which work in theory but which in almost all the practical situations we see, are going to struggle.

      Until I can find a few hours and a cold towel, I'm saying no more.
      Best Forum Adviser & Forum Personality of the Year 2018.

      (No, me neither).

      Comment


        Not been on here for a while but got a call regarding the 2019 tax charge from a guy in my group from years ago.

        I settled my open years back in 2015 and I'm just about paid off which has nearly killed me off and my marriage on multiple occasions.

        Apologies if this has already been asked....

        1) Are settled years are exempt from this charge?
        2) When I requested HMRC to give me the years that I was under investigation for CLSO, they gave me 3 years out of the 4 I'd been using trusts for. I'm assuming from having a brief read around that I'd have to voluntarily declare the amount to HMRC before the end of CLSO 2.0 to arrange settlement for that year?

        I've been reading the publication from the Government on the disguised renumeration detailed settlement terms document and Section 2.6 Previous settlements seems to contradict the proposed legislation.

        Does anyone had a clear understanding of this.

        Ta

        Comment


          Originally posted by bluemonkey71 View Post
          Not been on here for a while but got a call regarding the 2019 tax charge from a guy in my group from years ago.

          I settled my open years back in 2015 and I'm just about paid off which has nearly killed me off and my marriage on multiple occasions.

          Apologies if this has already been asked....

          1) Are settled years are exempt from this charge?
          2) When I requested HMRC to give me the years that I was under investigation for CLSO, they gave me 3 years out of the 4 I'd been using trusts for. I'm assuming from having a brief read around that I'd have to voluntarily declare the amount to HMRC before the end of CLSO 2.0 to arrange settlement for that year?


          I've been reading the publication from the Government on the disguised renumeration detailed settlement terms document and Section 2.6 Previous settlements seems to contradict the proposed legislation.

          Does anyone had a clear understanding of this.

          Ta
          1/yes
          2/yes, all (inc. closed)years now also need to be settled via ‘voluntary restitution ‘ to avoid lc2019

          Comment


            So will there be a difference in the charge between voluntarily restitution and the LC2019?

            I assume I would have to provide them with figures for that year and they would calculate the tax.

            If these unopened years were not hit with a DA how are they aware of them? Seems to me that the carpet bombing approach of the LC2019 may not cover everyone or am I missing something? In other words how do they know of everyone’s unopened years if they didn’t raise a DA on them?

            Comment


              Originally posted by bluemonkey71 View Post
              So will there be a difference in the charge between voluntarily restitution and the LC2019?

              I assume I would have to provide them with figures for that year and they would calculate the tax.

              If these unopened years were not hit with a DA how are they aware of them? Seems to me that the carpet bombing approach of the LC2019 may not cover everyone or am I missing something? In other words how do they know of everyone’s unopened years if they didn’t raise a DA on them?
              - There is no way of knowing if they are aware of them, however if anyone took the risk of not telling them then they could be hit with the LC and also penalties for not disclosing.

              Comment


                LC19 requires people to provide information to HMRC, on outstanding loans which haven't already been settled, between 6 Apr 2019 and 31 Sept 2019.

                If you haven't provide info before 1 Oct 2019, and HMRC find out, you can get a penalty of £300.

                If HMRC issue a £300 penalty, then you get further penalties of £60/day until you provide the info, up to a maximum of 90 days.

                However, the real crunch time comes on 31 Jan 2020.

                If you haven't declared the loans on your 2018/19 self-assessment return then you're into evasion territory. If HMRC find out, you could get a penalty of up to 100% of the tax owed.

                Some people with closed years may be tempted to keep quiet, and hope they slip under the radar, but it's risky.
                Last edited by Loan Ranger; 13 February 2018, 10:18.

                Comment


                  Originally posted by Loan Ranger View Post
                  LC19 requires people to provide information to HMRC, on outstanding loans which haven't already been settled, between 6 Apr 2019 and 31 Sept 2019.

                  If you haven't provide info before 1 Oct 2019, and HMRC find out, you can get a penalty of £300.

                  If HMRC issue a £300 penalty, then you get further penalties of £60/day until you provide the info, up to a maximum of 90 days.

                  However, the real crunch time comes on 31 Jan 2020.

                  If you haven't declared the loans on your 2018/19 self-assessment return then you're into evasion territory. If HMRC find out, you could get a penalty of up to 100% of the tax owed.

                  Some people with closed years may be tempted to keep quiet, and hope to slip under the radar, but it's risky.
                  That's all well and good. But I have been out of the country since 2004, bar one i have no idea of any amounts, schemes or even suppliers. This is not an attempt to keep quite. this is, to put it bluntly, "bloody ridiculous". I do not even have the same bank account so if I could get info from 20 years ago the bank will not even talk to me.

                  Comment


                    Originally posted by phil@dswtres View Post
                    - There is no way of knowing if they are aware of them, however if anyone took the risk of not telling them then they could be hit with the LC and also penalties for not disclosing.
                    Ok damned if you do and Russian roulette if you don’t

                    Comment


                      Originally posted by me206et View Post
                      That's all well and good. But I have been out of the country since 2004, bar one i have no idea of any amounts, schemes or even suppliers. This is not an attempt to keep quite. this is, to put it bluntly, "bloody ridiculous". I do not even have the same bank account so if I could get info from 20 years ago the bank will not even talk to me.
                      I totally agree, it's ridiculous to impose a charge on things that happened 20 years ago. But, sadly, that's the mad HMRC world we live in now.

                      Btw, does anyone know what the position is on LC19 if you are non-resident in 2018/19?
                      Last edited by Loan Ranger; 13 February 2018, 11:32.

                      Comment

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