LC Tax advisor: Recommended? Questions on LC?

[DealorNoDeal]

And on the subject of recommendations for profession advice, are there any recommendations?

webberg (WTT) has been the main advisor on this forum.

[ozzyo99]

I think Webberg (an professional tax adviser on this forum) explained the technical differences between settling and paying the loan charge in a separate thread.

WRT to loan charge, pre 9th December 2010 is safe. 9th December 2010 till 5th April 2016, you need to check which enquiries have been opened. If you disclosed your use of scheme usage and no enquiries were opened then again those years are safe. Post 5th April 2016, you will have to make disclosure of scheme usage regardless.

Paying the loan charge is not settling, so the underlying enquiry will remain open.

With regards to loan charge, you'll need to do some number-crunching yourself. Previously, you had to stick all your loans into a single years tax return, meaning most of your loans are in the 40% bracket. now you can spread it over three years so this would have an effect on how much you owe, as you would be able to prevent more of your loans from going into the 40% bracket.

Once you do the maths for loan charge vs settling, you will have a better idea as to which option is better for you.

With regards to paying the loan charge, theoretically you can get your money back if things subsequently move in your favour, in practice I'm not so sure, maybe that's all pipe dreams.

With regards to settling, please submit your expenses to HMRC in order to bring your bill down. At the very least, they need to consider your travel expenses.

Thanks everybody, very helpful.

And on the subject of recommendations for profession advice, are there any recommendations?

[Superfly]

I think Webberg (an professional tax adviser on this forum) explained the technical differences between settling and paying the loan charge in a separate thread.

WRT to loan charge, pre 9th December 2010 is safe. 9th December 2010 till 5th April 2016, you need to check which enquiries have been opened. If you disclosed your use of scheme usage and no enquiries were opened then again those years are safe. Post 5th April 2016, you will have to make disclosure of scheme usage regardless.

Paying the loan charge is not settling, so the underlying enquiry will remain open.

With regards to loan charge, you'll need to do some number-crunching yourself. Previously, you had to stick all your loans into a single years tax return, meaning most of your loans are in the 40% bracket. now you can spread it over three years so this would have an effect on how much you owe, as you would be able to prevent more of your loans from going into the 40% bracket.

Once you do the maths for loan charge vs settling, you will have a better idea as to which option is better for you.

With regards to paying the loan charge, theoretically you can get your money back if things subsequently move in your favour, in practice I'm not so sure, maybe that's all pipe dreams.

With regards to settling, please submit your expenses to HMRC in order to bring your bill down. At the very least, they need to consider your travel expenses.

[DealorNoDeal]

Appreciate the response, thank you.

So will the 100k I owe differ if paid via TTP via settlement, or if paid via the LC? Does just paying it off as a single payment inflate the number I'll owe? As the previous poster said, settlement and LC are NOT the same thing. LC works out cheaper if you spread it over 3 years, than paying LC in one hit, because there's less higher rate tax.

For me there's no material difference in paying it off in one hit versus dragging it out over several years, therefore I guess what I'd love to know (before I talk to these sharks) is how to play my cards. Settlement via TTP works out more expensive than settlement lump sum because you incur additional interest charges during the TTP.

Does that make sense?

See above.

First step is to decide whether you want to settle or pay the LC.

Next step is to figure out which is the cheapest way to do that.

[dammit chloe]

Appreciate the response, thank you.

So will the 100k I owe differ if paid via TTP via settlement, or if paid via the LC? Does just paying it off as a single payment inflate the number I'll owe?

For me there's no material difference in paying it off in one hit versus dragging it out over several years, therefore I guess what I'd love to know (before I talk to these sharks) is how to play my cards.

Does that make sense?

You need to run the numbers. In most cases LC will be more expensive.

Please note: Paying the Loan Charge does not mean you have settled your tax issues. Settlement does. They are not the same thing and both have pros and cons. Seek professional tax advice.

[ozzyo99]

See above.

If you weren't aware, you can spread the LC over 3 tax years to reduce the impact 2018/19, 2019/20 and 2020/21. I think you can also TTP those payments.

Appreciate the response, thank you.

So will the 100k I owe differ if paid via TTP via settlement, or if paid via the LC? Does just paying it off as a single payment inflate the number I'll owe?

For me there's no material difference in paying it off in one hit versus dragging it out over several years, therefore I guess what I'd love to know (before I talk to these sharks) is how to play my cards.

Does that make sense?

[DealorNoDeal]

Hi all,

Just had my figures through last week and now need a few conversations with advisors in the know to understand the best course of action for my circumstances.

Does anybody have a recommendation based on your own positive experience? I'll leave this to others as I have no personal experience of using an advisor.

My case should be fairly simple to deal with, but I've some questions I'd welcome opinion on.

My headline is 100k, but I'm a little confused on the strategy for settling (and how quickly) versus repayment of the LC and the benefits of each to me.

I'm fortunate in so much as I can obtain the full amount owed via family loans, obviously HMRC wouldn't recognise this from my overall financial status. I also know HMRC don't do "deals" or reduce the amount owed (in their eyes), but I wondered if anybody had any lessons to tell with regards to paying it off quickly, or by just sticking to the timeline agreed? You should be able to get a few years to pay it off. If this is of interest, ask for a payment plan (TTP -time to pay)

On a more fundamental level, I also cannot understand if there's a benefit to me in settling at all? In doing so I sign away any rights to refund (I note this week's finance bill update, well done LCAG), and possibly other conditions too which I'm accepting under settlement. On the other hand, if I've the money to just pay the LC when it's due, do I cling on to more rights? Is the money owed the same, or will HMRC add some other value to it? Personally, I wouldn't settle until the outcome of the FB is known. If that means having to pay the LC, that's what I would do. Settlement is far more final.

Sorry for the scattergun!

See above.

If you weren't aware, you can spread the LC over 3 tax years to reduce the impact 2018/19, 2019/20 and 2020/21. I think you can also TTP those payments.

[ozzyo99]

Hi all,

Just had my figures through last week and now need a few conversations with advisors in the know to understand the best course of action for my circumstances.

Does anybody have a recommendation based on your own positive experience?

My case should be fairly simple to deal with, but I've some questions I'd welcome opinion on.

My headline is 100k, but I'm a little confused on the strategy for settling (and how quickly) versus repayment of the LC and the benefits of each to me.

I'm fortunate in so much as I can obtain the full amount owed via family loans, obviously HMRC wouldn't recognise this from my overall financial status. I also know HMRC don't do "deals" or reduce the amount owed (in their eyes), but I wondered if anybody had any lessons to tell with regards to paying it off quickly, or by just sticking to the timeline agreed?

On a more fundamental level, I also cannot understand if there's a benefit to me in settling at all? In doing so I sign away any rights to refund (I note this week's finance bill update, well done LCAG), and possibly other conditions too which I'm accepting under settlement. On the other hand, if I've the money to just pay the LC when it's due, do I cling on to more rights? Is the money owed the same, or will HMRC add some other value to it?

Sorry for the scattergun!