Discovery assessment season - unexpected bills from HMRC

[EBTContractor]

Maybe so, but bear in mind if you have had loans then you will be expected to declare them on your SA for 2019. Don't and you will enter evasion territory. That is what this charge is all about, a catch all piece of legislation.

And what if you live overseas and don't have to complete a SA?

[eek]

Advising loan amounts.

I agree that many will be unaware of their legal obligations but that does not remove the obligation. Late comers to the party will undoubtedly be accused of all sorts of heinous crimes and be subject to wholly unfair penalties.

However HMRC has extensive powers to require promoters to supply lists of people and may even come to people like us for details. (Not entirely sure that would achieve much as all our clients are on their radar).

It is also tied up with making tax digital (a horror show unfolding in front of us). It may be that EVERY UK taxpayer get the question about loans.

Appeal letter.

There is no one format. Just keep it simple.

I have received your assessment dated xx/xx/xxxx regarding tax year yy/zz.

I believe the value to be incorrect and that the loans assessed should be £xx,xxx / £0 for no loans were taken that year.

I therefore appeal the assessment and request that the tax demanded be stood over until an amendment can be agreed.

Added a couple of bits to make things easier all round but never go into detail keep things as simple as possible

[Jes1]

Added a couple of bits to make things easier all round but never go into detail keep things as simple as possible

Many of us have been through this already.

Once they have received your appeal letter, they will ask you to prove you never received the loans by asking for your bank statements for the period in question. Whether you want to provide them or not will be a decision for you to make. I chose not to provide them and received an APN about a year later.

[HebdenMole]

Thank you - I think I will provide bank statements as for that year they completely prove I wasn't earning what they say I was.

Out of interest why wouldn't you provide the statements? Isn't an APN worse?

[cactus2]

Many of us have been through this already.

Once they have received your appeal letter, they will ask you to prove you never received the loans by asking for your bank statements for the period in question. Whether you want to provide them or not will be a decision for you to make. I chose not to provide them and received an APN about a year later.

Hi Jes1

Out of interest, were the APNs accurate?

[Jes1]

Thank you - I think I will provide bank statements as for that year they completely prove I wasn't earning what they say I was.

Out of interest why wouldn't you provide the statements? Isn't an APN worse?

What I didn't know at the time was that I had actually been paid by loans which is why I initially told HMRC I haven't received any loans. I had never signed a loan agreement from what I remember. Once I had realised this, an APN was inevitable so no point in me providing bank statements.

Bank statements are personal and HMRC may question any transactions which they believe may be income on your statements which could open you up to further questions not related to the use of schemes so be ready for that. Not that I had anything to hide but didn't want the extra stress.

[Jes1]

Hi Jes1

Out of interest, were the APNs accurate?

My APN was accurate but most of them aren't so double check yours.

[webberg]

My APN was accurate but most of them aren't so double check yours.

Have to say that we've looked at several thousand APNs and the error rate in terms of number/calculation is around 10% to 15%.

By all means check the numbers but do not make an assumption that it is likely to be inaccurate.

[HebdenMole]

What I didn't know at the time was that I had actually been paid by loans which is why I initially told HMRC I haven't received any loans. I had never signed a loan agreement from what I remember. Once I had realised this, an APN was inevitable so no point in me providing bank statements.

Bank statements are personal and HMRC may question any transactions which they believe may be income on your statements which could open you up to further questions not related to the use of schemes so be ready for that. Not that I had anything to hide but didn't want the extra stress.

Thank you. Don't think I've got any other money coming in!

In my appeal letter I confirmed it was loans (as in I said the loan amount was £xxx).

[webberg]

If initially you "didn't know" you had loans, but you subsequently disclosed "loans to value £x", what made you realise that loans were involved.

I ask out of genuine curiosity.

If you were persuaded by HMRC that you had loans, how did they do that?