Loan charge - review outcomes - impact on settlement

[Ltdoptions]

Why do you say 2011 specifically? Just curious... as my loans are after 2011

The 2011 Finance Bill was a flag in the sand regarding their view of DR schemes .

[dammit chloe]

Why do you say 2011 specifically? Just curious... as my loans are after 2011

As someone just said that is when the Disguised Remuneration terminology came in, in that years finance bill.

Not that I think they are ready for any sort of compromise yet. I am just suggesting that if there is it will probably use landmarks dates or tax status rather than invent something new. This would make it clear and easy to implement. It could equally well be closed years are recognised as closed as per House Of Lords recommendations.

[Ltdoptions]

Anything pre-2011 should absolutely be thrown out & all closed years should stay closed. Wishful thinking though probably.

There does seem to be a slight thawing in their attitude on TTP / enforcement, although actions will speak louder than words on that one. I don't believe they won't press for bankruptcies.

[Joolsey86]

As someone just said that is when the Disguised Remuneration terminology came in, in that years finance bill.

Not that I think they are ready for any sort of compromise yet. I am just suggesting that if there is it will probably use landmarks dates or tax status rather than invent something new. This would make it clear and easy to implement. It could equally well be closed years are recognised as closed as per House Of Lords recommendations.

As a coincidence 2011 happens to be 6 years from 2017 when act was introduced which would cover the 6 years they would be allowed to go back.

[nowayout]

Apologies if mis-reading, but are you suggesting if loans are 2011 onwards then nothing will change despite all the current activity around LCAG APPG and any success they have and therefore no option but to settle?

[Joolsey86]

@NoWayOut

No, that is more about retrospective legislation.

There are 2 JRs.

1) LCAG - Which wants to remove retrospective element of Charge, so it is from Royal Ascent 2016
2) WTT - Which wants to force HMRC to go after employers first as per rangers decision in Supreme Court

SO basically, HMRC have to go after you via an enquiry and not the Loan Charge.

Everything is an unknown, so much on here is rumour, summisation and gossip, you are best speaking to a tax advisor to get it clear in your head, as my bullets above are probably wrong too!

[webberg]

@NoWayOut



There are 2 JRs.


2) WTT - Which wants to force HMRC to go after employers first as per rangers decision in Supreme Court

I have to correct you.

WTT are NOT engaged in any Judicial Review action.

We are in the preliminary stages of going to Tribunal to defend those clients who believe in our strategy and do not want to accept HMRC's version of the truth. That is NOT however a JR.

A Judicial Review action is about how the law is applied to certain situations and whether that can be done fairly and competently by the authority charged with the task.

JR's against legislation on constitutional grounds (usually Human Rights) have been seen in the tax world in the past 5 years on APNs and we are promised action on the loan charge.

WTT has in the past had plans to use a JR to challenge HMRC's use of discovery but given that the loan charge rides roughshod over taxpayer protections from HMRC being able to hide their numerous errors and instead penalise people for those errors, we have stalled these until we see what happens with the loan charge.

[Tiger22]

So, as a consequence of the review, will we know before the end of the tax year how many years back the LC19 legislation will go? When does it get finally decided what is the scope of the LC19 legislation?

My course of action is heavily dependent on knowing how many years back LC19 will go and I have to decide whether to agree a CLSO2 settlement offer (which is a mix of open and closed years) by April 5th.

[webberg]

So, as a consequence of the review, will we know before the end of the tax year how many years back the LC19 legislation will go? When does it get finally decided what is the scope of the LC19 legislation?

My course of action is heavily dependent on knowing how many years back LC19 will go and I have to decide whether to agree a CLSO2 settlement offer (which is a mix of open and closed years) by April 5th.

You should assume that the loan charge will be unaffected by the review and that loans from 1999 are going to be included.

[Cassy]

I settled tax years 08/09 and 09/10 in 2013. This was due to an assessment raised for those years. The HMRC chose not to tackle 07/08 because it was time barred.

I received the July 2018 letter about the loan charge, had no idea what it was about-because I thought I had settled- and called the HMRC, the guy on the phone saw that I had settled and said that it was a mistake! I heard a news item on the radio the other day and thought hmm, somethings up and that the advice he gave was bogus. So as a result I have not been in touch with the HMRC, in time, to discuss a settlement for that one time barred year.

In addition I called the Hmrc months ago to discuss another tax matter and they said I was owed a rebate and owed zero tax under the personal assessment process. Confusing.

I’m done giving them my money. But have contacted my financial advisor anyway. My gut tells me to get the ball rolling but hold back from any settlement until I see what happens with the review. Thoughts?