AML 2019 Loan Charge

[taxgerry]

Lets take a step back and try to think about this. Yes, technically AML or Knox house Trust could come demanding the so called 'loans'. However, it can be proved that these were not loans but disguised remuneration. More so if you have settled with the HMRC. The court rulings so far, be it the Rangers case in Scotland, or the AML judicial review are all saying that these were not loans but disguised remuneration.
Please do not fall for another scum of 5% deed of release. That money is better spent arguing for your case in court. Even better if all ex-AML users came together and argue a single case.
If AML came demanding for the loans to be repaid, do not be scared, approach the courts for relief. The courts cannot rule that it is disguised remuneration in favour of the HMRC and then argue that the same disguised remuneration is loans in favour of AML. The logic is twisted. By ruling that the loans are disguised remuneration, that is what the 'loans' are. They cannot be both disguised remuneration and loans.

Even by their own admission, AML in their email of 18th April have unwittingly accepted that these 'loans' were in fact disguised remuneration. Read this extract from the email:
"...You will have received an email from Knox House Trust, the Trustees of the trust that holds your loan. They have outlined 2 options to mitigate the 2019 Loan Charge; Settlement or Repayment..."
Settlement means paying the tax due on the 'loan'. Now we have all taken bank loans or other regulated financial institution loan. I have never had to pay a tax on those loans. Knox House Trust loans are the only loans I have heard of where the recipient has to pay income tax on a loan.

Guys, the more we see the duplicity of AML/Knox, the more we should take the fight to them.

I suggest we start researching and sharing all the court cases that AML have lost and also other similar cases like the Rangers one. Does anyone know the citation of all the AML cases lost so far at court or FTT?

I am inline like most of us to get stung next April by HMRC on Tax on my loans. The idea of fighting AML is a good one I would be happy to contribute towards a pool fund to challenge AML/Knox. There are a couple of things that would give us a good case, firstly HMRC announced in the 2016 Budget that disguised remuneration would be subject to a loan charge, AML did not inform anyone about this but they should of as it meant that they continued to take money from us knowing we would get hit with a loan charge. If we actually didnt take out a loan but a remuneration agreement we have been misold and AML will have to compensate.

On the concerns about paying loans back my understanding is the the Trustees are bound to represent our best interests and asking for the loans back clearly isnt.

[HW360]

LC2019 Options

All solutions to the Loan Charge will be provided by some kind of newly formed entity. Promoting a Loan charge solutions via an existing tax / promoter identity would attract too much attention from tax authorites. This is no surprise.

No solution provider is going to explain the mechanics. This is not to protect them...but it's to protect the user. There will be no insurances, opinions or fighting funds. Once the originator does this, the strategy will have many hallmarks of a tax avoidance scheme and be disclosable under DOTAS etc.

It has been made clear that settlement of loans from third parties etc will be 'ignored' if made in connection with a new tax avoidance scheme. Any transaction(s) entered into which have the effect of sidestepping the new charge must be entered into on purely commercial grounds. By telling the user how the solution works, there is a high risk of the solution itself collapsing.

There are options out there. But the recommendation process is going to remain very vague, because to sidestep the 2019 loan charge, the solution provider cannot tell you that the solution sidesteps the loan charge. Get your head around that one.

[QUODM]

AML lost judicial review and loans were DR?

Someone mentioned in this forum that AML lost their JR and their loans were classified as Disguised Renumeration. Can someone point me to the case or some summary of that?
On what basis were they determined not to be loans?
I note with dismay on AML generally that Knox pretends not to know them and even PTS is a 'totally different company' even though same morons working for them. How they can just close this company and the employees accept the liability and HMRC go out of their way to pass the charges to employees leaving AML is one of the more repugnant parts of this whole situation.
The 5% fees they are asking for now on what is clearly going to be a scheme that can't win is surely the fraudulent part.

[webberg]

The below is a post from "bleakhse" which I seem to have missed. For what it's worth, my comments in bold.

Lets take a step back and try to think about this. Yes, technically AML or Knox house Trust could come demanding the so called 'loans'. [Why are they "so called"? You signed a loan agreement. The loan is a legal obligation. The fact that the tax system regards them as something else is irrelevant to the positon of the borrower and lender]However, it can be proved that these were not loans but disguised remuneration. [Incorrect. For tax purposes the payment may be remuneration. For legal purposes, the loan exists.] More so if you have settled with the HMRC. The court rulings so far, be it the Rangers case in Scotland, or the AML judicial review are all saying that these were not loans but disguised remuneration. [A Judicial Review is into the legality or operation of a law. It has nothing to do with the tax liability. If you have settled then the decision in a tax case is irrelevant because you cannot benefit or be harmed by it].

...

If AML came demanding for the loans to be repaid, do not be scared, approach the courts for relief. [On what grounds?] The courts cannot rule that it is disguised remuneration in favour of the HMRC and then argue that the same disguised remuneration is loans in favour of AML. [The Courts have already held that the loans are remuneration. No Court has yet been asked about whether the loan obligations remain.] The logic is twisted. [No it's not. You apply tax law to tax and contract law to loans. Nowhere does it say that the definitions used in those sets of laws have to be the same] By ruling that the loans are disguised remuneration, that is what the 'loans' are. They cannot be both disguised remuneration and loans. [Sadly wrong].

I don't mean to offend or discourage this sort of thinking but if there is to be a fight over various issues which costs money, please enter into this in full knowledge of the facts and at the end of the day there is no substitute for discussing this with a knowledgeable person, rather than an anonymous poster.

My apologies if you have such professional knowledge.

[Hero1234]

AML 2019 Loan Charge

The below is a post from "bleakhse" which I seem to have missed. For what it's worth, my comments in bold.

Lets take a step back and try to think about this. Yes, technically AML or Knox house Trust could come demanding the so called 'loans'. [Why are they "so called"? You signed a loan agreement. The loan is a legal obligation. The fact that the tax system regards them as something else is irrelevant to the positon of the borrower and lender]However, it can be proved that these were not loans but disguised remuneration. [Incorrect. For tax purposes the payment may be remuneration. For legal purposes, the loan exists.] More so if you have settled with the HMRC. The court rulings so far, be it the Rangers case in Scotland, or the AML judicial review are all saying that these were not loans but disguised remuneration. [A Judicial Review is into the legality or operation of a law. It has nothing to do with the tax liability. If you have settled then the decision in a tax case is irrelevant because you cannot benefit or be harmed by it].

...

If AML came demanding for the loans to be repaid, do not be scared, approach the courts for relief. [On what grounds?] The courts cannot rule that it is disguised remuneration in favour of the HMRC and then argue that the same disguised remuneration is loans in favour of AML. [The Courts have already held that the loans are remuneration. No Court has yet been asked about whether the loan obligations remain.] The logic is twisted. [No it's not. You apply tax law to tax and contract law to loans. Nowhere does it say that the definitions used in those sets of laws have to be the same] By ruling that the loans are disguised remuneration, that is what the 'loans' are. They cannot be both disguised remuneration and loans. [Sadly wrong].

I don't mean to offend or discourage this sort of thinking but if there is to be a fight over various issues which costs money, please enter into this in full knowledge of the facts and at the end of the day there is no substitute for discussing this with a knowledgeable person, rather than an anonymous poster.

My apologies if you have such professional knowledge.

Your summation of the above is nothing but fatalist in nature and wrought with assumptions of a strict interpretation of law. Have you not heard of the concept of Equity where law is inadequate to deal with an unfair situation be it contract or any other human transaction. He who comes to Equity comes with clean hands. i.e those individuals caught up in this mess did nothing wrong. If HMRC have deemed these "loans" as income upon which tax has been demanded, that is what they are. I have read in some quarters where these loan providers have requested for a 5% payment of the whole loan amount to write it off. Even that is considered cheeky after creaming off 5% of what is meant to be your income.

[WTFH]

Your summation of the above is nothing but fatalist in nature and wrought with assumptions of a strict interpretation of law.

I think Webberg may have been researching this and put more effort into understanding it than most on this forum.
There are some new posters turning up here with great ideas that they are convinced will work. Most of them have already been tried, researched, evaluated, and found to fail. People like webberg have been working on the problem for the last 3+ years, long before many thought there was a problem, or realised they would be caught up in it.

While free advice given on an internet forum should be taken at the value you've paid for it, it's also worth checking out who is giving the advice.

[QUODM]

Where is AML JR result?

Hi,
I asked this before but I can't see any result where AML lost their JR with HMRC which was mentioned before in these forums. Can someone point me to the case if they know where it is? Did this really happen?
Thx

[stibbok]

Not sure how much help this will be, but HMRC have answered a few questions: 2019 Loan Charge: HMRC answers your top complaints if you're a contractor

[Dmac]

Not sure how much help this will be, but HMRC have answered a few questions: 2019 Loan Charge: HMRC answers your top complaints if you're a contractor

Thanks for this link - there is another one from today:-

2019 Loan Charge: HMRC answers ContractorUK readers' top complaints (part 2)

Think the articles would be useful as a "sticky" as they answer many of the questions people are asking

The articles are highlighted on the opening page of the Contractor UK website under Latest News, but most people probably use their own link direct to this forum, so miss the news pages.

[webberg]

Hi,
I asked this before but I can't see any result where AML lost their JR with HMRC which was mentioned before in these forums. Can someone point me to the case if they know where it is? Did this really happen?
Thx

As far as I know AML took two cases to Court.

One was an attempt to have some years of enquiry removed from those being heard in FTT. These were opened by a discovery assessment and AML supported their client in trying to have the "discovery" rules invalid. I think it was a good try but unsuccessful for the reasons cited by the Judge.

Addo v Revenue & Customs (PROCEDURE : Other) [2018] UKFTT 492 (TC) (03 September 2018)

The second:
Dickinson & Ors, R (on the application of) v HM Revenue & Customs [2017] EWHC 1705 (Admin) (07 July 2017)

was an attempt to reverse APNs issued in circumstances where HMRC had previously agreed to hold over the tax.

The Judge was highly critical of HMRC and their actions but eventually had to concede that despite the manifest errors and bad practice and faith shown by HMRC, he was bound to follow the intentions of Parliament in permitting APNs and bad practice from HMRC in delivering that intention could not stop them being valid.

As far as I am aware AML continue discussions with HMRC (although these are now in the hands of the former tax team who have reformed as a separate company) and for all I know will be in Tribunal again soon to argue the substantive issues, now that these preliminary skirmishes are out of the way. I'm not connected with the former AML people nor the new tax team however and suggest that they would have more and better information.