Big changes following loan charge review - Makesworth Accountants

Big changes following loan charge review

Big changes following loan charge review Accountants in Betsham Accountants in Bexon Accountants in Bicknor Accountants in Biddenden Accountants in Bilsington Accountants in Bilting Accountants in Bishopsbourne Accountants in Blean Accountants in Bonnington Accountants in Bough Beech Accountants in Boughton Aluph Accountants in Boughton Corner Accountants in Boughton Green| Accountants in Stowting Accountants in Rame Accountants in Rezare | Accountants in Saveock | Accountants in Tremar Accountants in Tresoweshill | Accountants in Trevarrian | Accountants in Winnards Perch | Accountants in Black Rock | Accountants in Cardinals Green | Accountants in Haringey | Accountants in Stonea Accountants in Wendy | Accountants in Waltham Forest | Accountants in Poyntzpass | Accountants in Harrowgate Hill | Accountants in Westhill Aberdeenshire | Accountants in New Kyo | Accountants in Startforth | Accountants in West Kyo | Accountants in Arney | Accountants in Claudy | Accountants in Seskinore | Accountants in Stracathro | Accountants in Ayr | Accountants in Ballantrae | Accountants in Fergushill | Accountants in Chapeltoun | Accountants in Dean Castle | Accountants in Moscow | Accountants in Cardross | Accountants in Pennan | Accountants in Radwell | Accountants in Wixams | Accountants in Torquay | Accountants in Loch Long | Accountants in Sidbury | Accountants in Sourton | Accountants in Great Thurlow | Accountants in Heckfield Green | Accountants in Henstead | Accountants in Ilketshall St Lawrence | Accountants in Appletreewick | Accountants in Challacombe | Accountants in Arram | Accountants in Coldridge | Accountants in Sotherton | Accountants in Boothferry | Accountants in Ufford | Accountants in Willisham | Accountants in Anglesey | Accountants in East Orchard | Accountants in Blore With Swinscoe

Big changes following loan charge review

The Government has revealed that a number of important changes will be made to the loan charge following he independent review of the disguised remuneration loan charge policy and its implementation by Sir Amyas Morse and his team.

The review examined whether the loan charge is an appropriate way of dealing with loans schemes (also known as disguised remuneration tax avoidance schemes) that have been used by some employers and individuals in order to try and avoid paying Income Tax and National Insurance contributions (NICs).

The Government accepted all but one of the recommendations made in the review. The main changes are as follows:

  • The Loan Charge will now only apply to loans taken out on or after 9 December 2010, rather than from 1999. The Review found that legislation announced in 2010 removed any doubt that tax was due.
  • The Loan Charge will not apply to users of loan schemes between 9 December 2010 and 5 April 2016 who fully disclosed their schemes on their tax return and where HMRC failed to act.
  • Taxpayers will be able to defer filing their returns and paying their Loan Charge liability until September 2020.
  • Taxpayers can split the loan balance over three tax years to make bills more affordable.
  • A new HMRC team will be tasked to collect tax from those who used the avoidance schemes pre-2010.
  • Extra time will be provided so that users of schemes can defer sending their return, and paying the tax for 2018-19, until the end of September 2020. Guidance on how this will work will be published in due course.
See also  Did you file your tax return on Christmas Day?

The package of measures is expected to reduce tax bills for more than 30,000 people subject to the loan charge. This includes an estimated 11,000 who will no longer have any loan charge to pay.

HMRC will not be able to process any refunds until changes to the loan charge legislation have been enacted by Parliament, expected in summer 2020. HMRC are also expected to announce further moves to crack down on promoters of Disguised Remuneration schemes in the upcoming Budget.

Need Accountancy Support?

For information on bespoke training, or if you have any other questions for Makesworth Accountant, please fill in your details below

Accountancy Support

Your Name(Required)

Proud to be featured in

Happy with our services? Please leave us a Google Review. Click here