Reply to: Settlements negotiations

[LandRover]

Within the settlement pack theres a section that requests further information in respect of your current financial status (called Instalment Assurances), does anyone know if the completion of this section necessery at this point?? will it hinder your chances of extended time to pay if you dont answer?. how can I comment if I dont know my total TAX liability.

Explain why you cannot pay in full in 30 days
Can you confirm that you have considered a bank loan to cover the settlement offer? If not, why not?
Can you confirm that any assets that you can realise are included in the lump sum amount? If not, why not?
What lump sum can you pay within 30 days?
What monthly payments can you afford to pay after 30 days?
Does the lump sum include any savings that you have? If not, why not?
Do you have any other payment arrangements in place?
If so, can you confirm that you are able to fund a settlement offer on top of these arrangements?
If you have other payment arrangements in place, have you kept up to date with these payments? If not, why not?


any thoughts would be appreciated

As long as the figures are sent in and perhaps you answer that TTP required with YES, then my thoughts are to not complete Instalment Assurances section. TTP can always be negotiated at a later stage.

[Swan1e]

Instalment Assurances

Within the settlement pack theres a section that requests further information in respect of your current financial status (called Instalment Assurances), does anyone know if the completion of this section necessery at this point?? will it hinder your chances of extended time to pay if you dont answer?. how can I comment if I dont know my total TAX liability.

Explain why you cannot pay in full in 30 days
Can you confirm that you have considered a bank loan to cover the settlement offer? If not, why not?
Can you confirm that any assets that you can realise are included in the lump sum amount? If not, why not?
What lump sum can you pay within 30 days?
What monthly payments can you afford to pay after 30 days?
Does the lump sum include any savings that you have? If not, why not?
Do you have any other payment arrangements in place?
If so, can you confirm that you are able to fund a settlement offer on top of these arrangements?
If you have other payment arrangements in place, have you kept up to date with these payments? If not, why not?


any thoughts would be appreciated

[Hero1234]

Settlements negotiations

If you have no undeclared income or mysterious credits to the account or have received any money that does not have a reasonable and honest explanation, why do you have anything to fear.

How much you have received is a fact.

It's a fact that YOU have a legal obligation to declare for tax purposes.

Thinking that HMRC is going to invent money you've never had and tax it, is frankly taking conspiracy theory into the stratosphere.

Thanks Webber.
You know them better than most of us here. Its natural to fear what you do not have a full grasp of as is the case here. But thanks for the reassurance.

[webberg]

Yes Webberg. Just worried about them fishing for more. Do I provide them with bank account detailing credits from 10 years ago? sorry my questions probably have obvious answers but I dont want to provide more information than is necessary.
Thanks for responding Webberg.

If you have no undeclared income or mysterious credits to the account or have received any money that does not have a reasonable and honest explanation, why do you have anything to fear.

How much you have received is a fact.

It's a fact that YOU have a legal obligation to declare for tax purposes.

Thinking that HMRC is going to invent money you've never had and tax it, is frankly taking conspiracy theory into the stratosphere.

[Hero1234]

Settlements negotiations

Surely you know if you've signed a loan agreement?

If not then check your bank account credits.

Yes Webberg. Just worried about them fishing for more. Do I provide them with bank account detailing credits from 10 years ago? sorry my questions probably have obvious answers but I dont want to provide more information than is necessary.
Thanks for responding Webberg.

[webberg]

Yes we understand that. But my question is, where there are no other loans other than the ones hmrc have information on, how do I prove to them that there are no others? They ask us in their loan pack to list all loans taken. Assuming you list these loans and they tally up with hmrc information, could they go about asking for you to prove you do not have more?

Surely you know if you've signed a loan agreement?

If not then check your bank account credits.

[Hero1234]

Settlement Negotiations

Just step back and think about it.

HMRC want you to pay tax on EVERY loan payment you have received.

The settlement is a process for doing that.

If you declare EVERYTHING and pay the tax, in theory you walk away and get on with life.

If you declare some and not all, you run the risk of HMRC being aware of this; rescinding the settlement; charging penalties.

In this scenario, entering an agreement with anybody, HMRC or otherwise, in which you have been less than 100% honest will have consequences if that shortfall comes to light.

The additional issues with HMRC are that they have a lot of data and may cross check to that; they have statutory penalty powers and need not go to Court to prove them; you have to declare ALL loans for the loan charge.

It's your choice, but deliberately withholding information is not something we would ever recommend.

Yes we understand that. But my question is, where there are no other loans other than the ones hmrc have information on, how do I prove to them that there are no others? They ask us in their loan pack to list all loans taken. Assuming you list these loans and they tally up with hmrc information, could they go about asking for you to prove you do not have more?

[webberg]

Won't HMRC estimate tax based on 5 x salary for the other years?

I had APN notices for only 2009 and 2010 but also I was with AML in 2011 as well (no APN).

So I would have to say I declare for all three years.

Can anyone confirm?
Regards

Just step back and think about it.

HMRC want you to pay tax on EVERY loan payment you have received.

The settlement is a process for doing that.

If you declare EVERYTHING and pay the tax, in theory you walk away and get on with life.

If you declare some and not all, you run the risk of HMRC being aware of this; rescinding the settlement; charging penalties.

In this scenario, entering an agreement with anybody, HMRC or otherwise, in which you have been less than 100% honest will have consequences if that shortfall comes to light.

The additional issues with HMRC are that they have a lot of data and may cross check to that; they have statutory penalty powers and need not go to Court to prove them; you have to declare ALL loans for the loan charge.

It's your choice, but deliberately withholding information is not something we would ever recommend.

[rshome]

You have told them everything. You have nothing to worry about.

Won't HMRC estimate tax based on 5 x salary for the other years?

I had APN notices for only 2009 and 2010 but also I was with AML in 2011 as well (no APN).

So I would have to say I declare for all three years.

Can anyone confirm?
Regards

[GreenMirror]

Got caught up in this mess over two years of which an APN was issued and which I paid over installments. 2009 and 2011. Got a settlement pack recently and wondered if they would ask me to prove that there were no other EBT loans apart from what they (hmrc) already have. I intend providing them with info from the loan providers AML in this case which they already have.. Can anyone tell me if they will stress me out to prove there are no others as there aren't. Are they going by what they already have or can they tell me to prove that there aren't any more. I only received an APN for one year but they are aware of the other year which i am not sure the APN covered. Need help here please as i am going out of my mind not knowing if they would open me up like a can of sardines on years not on scheme.

You have told them everything. You have nothing to worry about.

[Hero1234]

Proof of loans.

Got caught up in this mess over two years of which an APN was issued and which I paid over installments. 2009 and 2011. Got a settlement pack recently and wondered if they would ask me to prove that there were no other EBT loans apart from what they (hmrc) already have. I intend providing them with info from the loan providers AML in this case which they already have.. Can anyone tell me if they will stress me out to prove there are no others as there aren't. Are they going by what they already have or can they tell me to prove that there aren't any more. I only received an APN for one year but they are aware of the other year which i am not sure the APN covered. Need help here please as i am going out of my mind not knowing if they would open me up like a can of sardines on years not on scheme.

[regron]

Is this the loan amount or the salary? I assume they already had both loan amount and salary.

It is a multiplication of the salary you declared on your Self Assessment. Whether they have loan amounts or not, they have been lazy and sent estimates using this multiplication method.

[Hero1234]

the salary you declared for that particular scheme year. I had two estimates for two of my years, although they were estimated at 3 x salary and 5 x salary.

I proceeded to tell them to do one and asked why they are estimating when they have all my details. They then came back with a true figure instead of estimating. A lot of the time they are just plain lazy, so you have to play your own game and not theirs !!!!

Is this the loan amount or the salary? I assume they already had both loan amount and salary.

[regron]

10 x what?

the salary you declared for that particular scheme year. I had two estimates for two of my years, although they were estimated at 3 x salary and 5 x salary.

I proceeded to tell them to do one and asked why they are estimating when they have all my details. They then came back with a true figure instead of estimating. A lot of the time they are just plain lazy, so you have to play your own game and not theirs !!!!

[webberg]

The answer is HMRC will use a x10 calculation in the absence of information from you.
If YOU don't report the loans (you need to do so by the end of this month if you want to register an interest in settling or I think by Oct 2019 for the Loan Charge which will need to be paid by the end of Jan 2020) you run the risk of very hefty penalties if/when they find out, that's if your scheme provider or trust hasn't reported the loans to them already. So in short, it's a very risky strategy. Yes pretty crappy I know.

Could I seek clarification on a couple of points here please?

We have dealt with a lot of settlement cases and have not seen HMRC use a 10x multiplier.

If you have got evidence of that, I'd like to see it as

a) it's not acceptable
b) almost certainly can be successfully challenged
c) is useful in showing a Tribunal

In terms of "hefty penalties", other than the sabre rattling we see in HMRC letters of "settle or else", do you have anything specific? If so, again i'd like to see it for the reasons above.

Thanks