More details from HMRC on implementation of the loan charge

Sep 07, 2020

Following on from the amended legislation for the loan charge which received Royal Assent in July, HMRC has now published further guidance for anyone affected by the changes to the legislation. If your clients have outstanding disguised remuneration loans that are subject to the Loan Charge, they must report the details of their loans by 30‌‌ September 2020.

HMRC are also holding an online webinar this week on 9 September which you can book onto now.

The further guidance contains information on how refunds of voluntary payments (known as voluntary restitution) will be calculated and further details of the application process. Information on next steps for employers are also included.  If any of your clients are affected by the changes, HMRC recommends that you review the latest information and discuss with your clients any actions they may need to take. 

If you have any further questions around the refund application process, then please get in touch with the HMRC helpline number 03000 534 226 or email HMRC on ca.loancharge@hmrc.gov.uk.

The full HMRC message is as follows:-

“We would like to draw your attention to the most recent set of updates available on GOV‌.UK in relation to the Loan Charge. 

If any individuals have disguised remuneration loans that are subject to the Loan Charge, the deadline to report the details of their loans is approaching. These loans must be reported to us by 30‌‌ September 2020 using the online form on GOV‌.UK. Anyone who wants to spread their disguised remuneration loan balances evenly across the 2018-19, 2019-20 and 2020-21 tax years also needs to do so by 30‌‌ September 2020. They can do this using the same online form.

To provide customers with more support, HMRC has published further information on the Loan Charge policy and how we support customers with tax debts.

Refunding voluntary payments made in disguised remuneration settlements

As a result of the recommendations in the Independent Loan Charge Review, certain voluntary payments (‘voluntary restitution’) made as part of a disguised remuneration settlement with HMRC can be refunded. 

We have published guidance about which voluntary payments can be refunded.

August 2020 disguised remuneration settlement terms

We have now published the new settlement terms for disguised remuneration loans not subject to the Loan Charge. If any of your clients would like to settle under these terms, please contact us using the details within the guidance. 

Further help and support    

Anyone subject to the Loan Charge who thinks they may have difficulties paying what they owe, should contact us. We want to help people to pay what they owe by working with them to agree an affordable payment plan.

Those with concerns can call us on 03000 599110, speak to their usual contact, or email ca.loancharge@hmrc.gov.uk.”

The following publications are also relevant:-

Details of a new Spotlight published by the GAAR Advisory Panel sets out their opinion in respect of a tax avoidance arrangement that rewarded a director through a remuneration trust.