What is the 2019 Loan Charge?

[webberg]

Apologies if this has already been answered but I am new, so thought I'd check.

I have several APNs and investigations going on, going back to 2010. I have generally ignored most of the HMRC letters but a final demand arrived a while back, still ignoring them until that court summons comes then I'll talk to them!

With this new Loan charge legislation I am not sure where I stand but I wanted to know if I start to pay back the loans, would this make a difference? Apologies if this is sounds too simple but the HMRC does not believe these were loans that would be repaid therefore we got taxed. What if we start to payback at £10 per month for example, surely this is proving the intent to pay the loan back, therefore muddies the water in the case? It's not then so clear cut for the HMRC right? The £10 a month example is not be taken seriously guys it's just to prove a point. If this sounds an idea with possible mileage, what if the company/promotor is no longer around who do we pay the loan back to? Surely this muddies the water even more? You cannot pay back someone a loan if the loanee is not around any longer.

Last point what if the whole of the loan can be paid back and then we can retrospectively go back and find an alternative (legal) way to declare the income? If the HMRC can go back retrospectively to tax us once a legal loophole has been made illegal, then surely we are allowed to do the same and select an alternative method to declare our income? Can we push it into a pension for example?

Never ignore HMRC letters etc. It is not helpful and generally leads to more trouble.

Repaying the loans makes no difference. The point at which the loan value becomes taxable is when it was due to you as a result of working at the end client. The subsequent loop of money to a lender and then to you is irrelevant for this purpose. HMRC believe you are due to pay tax as above and what you do with the loan is not going to impact that.

The Supreme Court has already decided the above. Your idea is therefore about 7 or 8 years too late.

You cannot make retrospective pension payments. Unless you have the power to make law, retrospection is not within your gift.

You need to speak to an adviser.

[Servia]

2019 charge - no open enquiry

I'm new here so please excuse any questions that have already been addressed elsewhere.

I have 3 questions:-
1) how will LC19 be calculated, my assumption was that it would be on the actual net loan amount received but I saw an alarming article saying that HMRC goons are being told to use the gross contract value (ie the amount before deduction of the scheme commission). This amount has presumably been the subject of corporation tax (at least for Uk run schemes) so this would be double taxation surely ?

2) Does anyone know how the declaration will be made on the 2019 return ?

3) I have loans from 2 earlier years that are not currently the subject of an investigation/APN etc . Originally i assumed that these hadn't been queried because of their age etc but now I think it was probably because of a DOTAS declaration failure). I'm not sure what to do about this, should I let them know before 1 October or just quietly include the loan balance on my 2019 return, pay and then possibly get a slap from them at a later date? Hoping they won't notice isn't really an option even though I suspect they might not (the scheme closed years ago). Presumably they could charge me a 30% penalty for stupidity ?

I wonder if anyone will ever take into account the revenue they will lose as a result of the bankruptcies and destroyed lives that this whole fiasco will generate as they convert workers into benefit claimants. That of course was a rhetorical question.



Thanks

[cojak]

Asbolutely NOT TRUe/

Iam catarogially NOT HRMC/
aslo NOT shceme premeteor or
NOT linked for shceme premotor.
and NO ex cotnacts at HRMC working on wink nudge/ and
NO skin in game ONLY CSLO2 employye contractar feeling 2019 FEAR AND DOUBT

please RETRACT and apoligies for acusation.

NO link to HRMC otherthan SCAREY letters giveme FEAR. reading iliketaxs hepful iformation and analsys obvios CSL02 ONLY WAY OUT the logicial coclusion TOTALLY DOOMED/
pay CSLO" and HRMC get fair tax PREMOTORS not unfarley taxed wwe pay LESS tax so WIN WNI WIN

look at GUIADNCE no 2019 made up revelant step even reuqired for 1999 tax/guiadnce is guiadnce used by Dury in COURT HRMC ALWSAYS win NO DOUBT OR UNCETRAINTY theyre

HRMC kindly tax now at LESS than 2019/
HRMC win PREMOTORS win WE win . CLSO2 makess ense AND NO COURT NO DOBT JUST CEARTINTY NO FEAR

This account is bizarre and unintelligible.

Permabanned.

[Iliketax]

This account is bizarre and unintelligible.

Yep. But she's just trying to troll me.

[Loan Ranger]

I'm new here so please excuse any questions that have already been addressed elsewhere.

I have 3 questions:-
1) how will LC19 be calculated, my assumption was that it would be on the actual net loan amount received but I saw an alarming article saying that HMRC goons are being told to use the gross contract value (ie the amount before deduction of the scheme commission). This amount has presumably been the subject of corporation tax (at least for Uk run schemes) so this would be double taxation surely ?

2) Does anyone know how the declaration will be made on the 2019 return ?

3) I have loans from 2 earlier years that are not currently the subject of an investigation/APN etc . Originally i assumed that these hadn't been queried because of their age etc but now I think it was probably because of a DOTAS declaration failure). I'm not sure what to do about this, should I let them know before 1 October or just quietly include the loan balance on my 2019 return, pay and then possibly get a slap from them at a later date? Hoping they won't notice isn't really an option even though I suspect they might not (the scheme closed years ago). Presumably they could charge me a 30% penalty for stupidity ?

I wonder if anyone will ever take into account the revenue they will lose as a result of the bankruptcies and destroyed lives that this whole fiasco will generate as they convert workers into benefit claimants. That of course was a rhetorical question.



Thanks

1) Net

2) Not yet. You have to provide loan charge info by 30 Sept 2019

3) If you don't provide loan charge info, and they find out, you could get a £300 penalty and then up to £60/day until you do provide the info. Don't know where you got the 30% figure from.

[ChimpMaster]

1) Net

2) Not yet. You have to provide loan charge info by 30 Sept 2019

3) If you don't provide loan charge info, and they find out, you could get a £300 penalty and then up to £60/day until you do provide the info. Don't know where you got the 30% figure from.

LR - I am pretty sure the penalties for non-disclosure on 2019 LC are much more severe. I read that it becomes a case of tax evasion and can even result in jail sentences (in most severe cases).

Else really, a £300 fine and £60/day (from the moment they find out as you've said) is not going to deter someone with big loans from trying to hide out.

[Loan Ranger]

LR - I am pretty sure the penalties for non-disclosure on 2019 LC are much more severe. I read that it becomes a case of tax evasion and can even result in jail sentences (in most severe cases).

Else really, a £300 fine and £60/day (from the moment they find out as you've said) is not going to deter someone with big loans from trying to hide out.

If it goes past 31 Jan 2020, and you haven't declared the loans on your self-assessment, then I agree it's moving into evasion territory.

I expect a lot of people will fail to declare, through ignorance of the LC, so I don't know how heavy handed HMRC will be.

What a fecking mess this is.

[Laxmi]

I'm going to sit down and take some quality time over my submittal. There is a farcical perversion of logic at play. A loan charge is being applied/adjusted/confiscated from contractors for tax that is not due as the scheme was perfectly legal and compliant at the time of use, yet the government has callously passed legislation that retrospectively makes it illegal, whist the same schemes are operational, right now perfectly legally.

Read very carefully the wording of the advice you are being given. You are being corralled into a compliant enclosure of your own making.

They would like you to believe that you have only two options. Settle or repay the loan. There is a third option, none of the above. There are tens of thousands of us and bureaucratically, we are their worst nightmare!

This legislation designed for movie stars and footballers, misapplied inherently results in the fact that tens of thousands of productive law abiding citizens (and their families) at the heart of the economy are being forced into an uncontrollable situation where they are worth more dead than alive. This is an intolerable and criminally negligent situation to force any citizen into and ministers heads must roll over this!

Many of you may opt to settle, at least to see what your options are. Some of you will have already paid out money to sharks for "advice"; some of you may be thinking of doing the same. All I can say to you is that after a lot of guff, you will be led to pretty much the same two options with interest.

You have to look at this pragmatically, dump the debt at their expense or be lumbered with repayments for the rest of your lives.

Very well put,it's a shame there is no oversight of government or hmrc. Some of us have been through this before, BN66, trying hard to get that retro tax looked into, I realised then how corrupt the UK govt is, how useless MPs are, how they just tow the party line no matter the consequences, they will be protected. I hope this time, as there are more victims of this miss-selling, it might have some impact. However, submissions to the parliament scrutiny were all ignored. There is a lot of activity on Twitter and a new group worth looking into called LAG- loan action group.

[Laxmi]

Apologies if this has already been answered but I am new, so thought I'd check.

I have several APNs and investigations going on, going back to 2010. I have generally ignored most of the HMRC letters but a final demand arrived a while back, still ignoring them until that court summons comes then I'll talk to them!

With this new Loan charge legislation I am not sure where I stand but I wanted to know if I start to pay back the loans, would this make a difference? Apologies if this is sounds too simple but the HMRC does not believe these were loans that would be repaid therefore we got taxed. What if we start to payback at £10 per month for example, surely this is proving the intent to pay the loan back, therefore muddies the water in the case? It's not then so clear cut for the HMRC right? The £10 a month example is not be taken seriously guys it's just to prove a point. If this sounds an idea with possible mileage, what if the company/promotor is no longer around who do we pay the loan back to? Surely this muddies the water even more? You cannot pay back someone a loan if the loanee is not around any longer.

Last point what if the whole of the loan can be paid back and then we can retrospectively go back and find an alternative (legal) way to declare the income? If the HMRC can go back retrospectively to tax us once a legal loophole has been made illegal, then surely we are allowed to do the same and select an alternative method to declare our income? Can we push it into a pension for example?

You may be able to offset the loan charge with pension contributions even using your carry forward. You'll need to speak to an ifa possibly. Only hmrc are in possession of a time machine, unfortunately. Aslo, do not fall foul of another avoidance scheme to offset loan charge, by paying back loans.

[Laxmi]

If it goes past 31 Jan 2020, and you haven't declared the loans on your self-assessment, then I agree it's moving into evasion territory.

I expect a lot of people will fail to declare, through ignorance of the LC, so I don't know how heavy handed HMRC will be.

What a fecking mess this is.

How do you figure that. If loans were declared 10 or so yrs ago , it's not evasion. Not declaring them in 2019 is non- compliance not evasion. Let's not get into the scare mongering or doing as hmrc and blur the lines between the two.