AML 2019 Loan Charge

[Iliketax]

I was a sole director, I was not employed by my limited company.

A director is an officeholder. An officeholder is an employee for employment income tax purposes - https://www.legislation.gov.uk/ukpga/2003/1/section/5

[Loan Ranger]

Hi, thanks for sharing the link. Let me put this way - I had a limited company and although I was a sole director, I was not employed by my limited company. In fact, SP was providing services to my company and thereby raising the invoice. I was hired by SP as a "consultant (self employed)" and was paid a retainer net of tax & NIC 2/4 and remaining as loan from the trust. Therefore, my returns were filed as self employed I guess.

Yes, the ltd co was just a shell to invoice the agency. As I said previously, I presume AML did this to "hoodwink" the agencies into thinking they were dealing with a bog standard contractor ltd co setup rather than an IoM scheme.

Other schemes used a single UK intermediary, for all their contractors, to invoice the agencies. Agencies sometimes got wind that these intermediaries were just a front for an IoM scheme and refused to deal with them.

Unfortunately, the schemes were often structured more to hide the scheme from agencies than for tax planning.

[GUD]

A director is an officeholder. An officeholder is an employee for employment income tax purposes - https://www.legislation.gov.uk/ukpga/2003/1/section/5

The company just paid me dividends and no salary was paid to me as a director/ employee. All payments were made to SP company and hence these payments were not subject to employer & employee NIC.

[stressed]

Finally Registered with HMRC

Hi All

Just sharing my experience that I called this number to HMRC 03000 534 226 and spoke to a lady who then took my details and also advised me that I have two outstanding queries/settlements covering 2 years 12/13 & 13/14 for which AML provided them details about my income then AML appealed and subsequently the inquiry was suspended. Within 20 min I received a pack of excel sheets in my inbox and the email says like this:

------------------------------
Thank you for calling today to register your interest in settlement.

As discussed, please complete the attached Contractor Loans Settlement Pack and send it back to [email protected] along with your reference CFSS-xxxxxx.

If you require any assistance in completing this pack, please contact us on 03000 534226.

Also, please note we deal with incoming post/emails in date order for fairness.
------------------------------

I rang back HMRC the following day and asked do I have to respond back by any date, they said the sooner the better as they will be responding to queries in date of order. I asked if there is a deadline of 30 Sep 2018 to provide me all the details, they didn't respond in yes or no but stressed the sooner the better!

They also said they will help filling in the excel sheets and work with me to work out what I owe!

I queried again that I am no tax expert but they said we are here to help and also asked if I know of any other years that I was involved in. I said to HMRC that AML has already provided you all the details then why asking me but again no satisfactory response.

My questions to the forum is:

1. If AML has already provided the details of couple of years to HMRC and missed one year - should I still declare that missing year?

2. If HMRC know what my outstandings are, then should I just pay it (with settlement plan over the years) or I have room to negotiate with HMRC to knock down the taxes due basically bargain with HMRC?

3. I also questioned that I didn't claim any expenses when I was with AML, they said regardless we need to see evidence/proof of expenses or else it will not be considered. Though HMRC said, I can make a case with justification should I wish but highly likely will be accepted.

4. What other options I have or how should I plan to play this with HMRC - how was one of the forum member (forgot the name) able to negotiate with HMRC on expenses and it was accepted? and if I remember he managed to knock off £5-6k of the taxes?

5. Any other advice would be very helpful if I may have forgotten!

Thanks

[phil@pmtc]

Hi All

Just sharing my experience that I called this number to HMRC 03000 534 226 and spoke to a lady who then took my details and also advised me that I have two outstanding queries/settlements covering 2 years 12/13 & 13/14 for which AML provided them details about my income then AML appealed and subsequently the inquiry was suspended. Within 20 min I received a pack of excel sheets in my inbox and the email says like this:

------------------------------
Thank you for calling today to register your interest in settlement.

As discussed, please complete the attached Contractor Loans Settlement Pack and send it back to [email protected] along with your reference CFSS-xxxxxx.

If you require any assistance in completing this pack, please contact us on 03000 534226.

Also, please note we deal with incoming post/emails in date order for fairness.
------------------------------

I rang back HMRC the following day and asked do I have to respond back by any date, they said the sooner the better as they will be responding to queries in date of order. I asked if there is a deadline of 30 Sep 2018 to provide me all the details, they didn't respond in yes or no but stressed the sooner the better!

They also said they will help filling in the excel sheets and work with me to work out what I owe!

I queried again that I am no tax expert but they said we are here to help and also asked if I know of any other years that I was involved in. I said to HMRC that AML has already provided you all the details then why asking me but again no satisfactory response.

My questions to the forum is:

1. If AML has already provided the details of couple of years to HMRC and missed one year - should I still declare that missing year?

2. If HMRC know what my outstandings are, then should I just pay it (with settlement plan over the years) or I have room to negotiate with HMRC to knock down the taxes due basically bargain with HMRC?

3. I also questioned that I didn't claim any expenses when I was with AML, they said regardless we need to see evidence/proof of expenses or else it will not be considered. Though HMRC said, I can make a case with justification should I wish but highly likely will be accepted.

4. What other options I have or how should I plan to play this with HMRC - how was one of the forum member (forgot the name) able to negotiate with HMRC on expenses and it was accepted? and if I remember he managed to knock off £5-6k of the taxes?

5. Any other advice would be very helpful if I may have forgotten!

Thanks

1.yes

2.no negotiation possible unfortunately

3.Regarding expenses, it is almost impossible without evidence. If you do have anything to prove it then it helps enormously if the affected years are open. Both of those, you have a good case.

[catanonia]

Replies for you

Hi, see answers below

Hi All


1. If AML has already provided the details of couple of years to HMRC and missed one year - should I still declare that missing year?
Yes, AML will be forced to give this information and HMRC will chase you and you will get fines / penalties + payments for falsely declaring.

2. If HMRC know what my outstandings are, then should I just pay it (with settlement plan over the years) or I have room to negotiate with HMRC to knock down the taxes due basically bargain with HMRC?
No room for negotiation. A figure is worked out + interest and you pay it.

3. I also questioned that I didn't claim any expenses when I was with AML, they said regardless we need to see evidence/proof of expenses or else it will not be considered. Though HMRC said, I can make a case with justification should I wish but highly likely will be accepted.
As I said previously, yes you can claim certain expenses such as mileage. I got my accountant to work the figures, put in the 150 miles a day mileage and get that taken off. As the lady at HMRC said, as long as justified and proved with figures, you can do this. I was the poster that you mentioned.


4. What other options I have or how should I plan to play this with HMRC - how was one of the forum member (forgot the name) able to negotiate with HMRC on expenses and it was accepted? and if I remember he managed to knock off £5-6k of the taxes?
That was me and see above.

5. Any other advice would be very helpful if I may have forgotten!
Get an independent accountant or advisor that knows this arena.



Thanks

[BankingContract0r]

As I said previously, yes you can claim certain expenses such as mileage. I got my accountant to work the figures, put in the 150 miles a day mileage and get that taken off. As the lady at HMRC said, as long as justified and proved with figures, you can do this. I was the poster that you mentioned.

Can I ask how you managed to justify this please? Was it simply a case of 'I live in location A and I had to travel to location X, Y, Z during this period' or there is some proof which is required?

Can monthly train tickets be claimed or would that be seen as regular travel?

[stressed]

Thanks Phil and Catanonia. Much appreciated.

@ Catanonia - would you be able to share any lines and spreadsheet etc your accountant prepared for expenses, I mean the exact justifications. The words with HMRC knocked out!

This would help me put my case forward as well, I shall tweak it obviously to put it in my words.

My case is straight forward though one last question:

Q: If I have paid the taxes to HMRC, is there any possibility that Knox House knocking at my door to claim back the loan amount? or once I have paid the chapter will be closed? What actions HMR is taking to prevent us in that scenario. And legally would we be obliged if Knox House comes out of the blue and claiming it loan. That's the last thing to worry about which would eventually kill my life!!!!

Thanks

[BankingContract0r]

Q: If I have paid the taxes to HMRC, is there any possibility that Knox House knocking at my door to claim back the loan amount? or once I have paid the chapter will be closed? What actions HMR is taking to prevent us in that scenario. And legally would we be obliged if Knox House comes out of the blue and claiming it loan. That's the last thing to worry about which would eventually kill my life!!!!

Thanks

This is one of the many issues with this punitive approach from HMRC; the loan still stands and there is nothing to stop it being recalled. Paying HMRC doesn't mean the loan is dealt with. You will need to purchase a deed of release. I've read figures of 5% of the total loan amount to do this.

Not what you wanted to hear I'm sure.

[mayfire]

Another spanner to throw in to the works

What about student loans?
Will we have to pay out for the years being recalculated via settlement?



Everytime I think I'm making headway and reaching a final figure there is another huge cost to add on top, it seems never ending.