Loan charge review launched
The Treasury has announced that Sir Amyas Morse, the former Comptroller and Auditor General and Chief Executive of the National Audit Office (NAO), will lead an independent review of the loan charge. This announcement gives some hope to many people affected by the contentious loan charge. This review will consider concerns raised by MPs and campaigners lobbying for the withdrawal of the loan charge.
The review will examine 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 a number of employers and individuals in order to avoid paying Income Tax and National Insurance contributions (NICs). HMRC has never approved these schemes and has always said they are ineffective.
HMRC has confirmed that whilst the review is under way, the Loan Charge remains in force. As part of this announcement, HMRC has confirmed that, if you are not settling your disguised remuneration scheme, you will still need to complete an additional information return by 30 September 2019. If you fail to do so HMRC reserves the right to charge penalties.
HM Treasury has asked Sir Amyas Morse to report back with his recommendations by mid-November. This will give taxpayers who are liable to the charge time to prepare ahead of the planned January 2020 deadline for making payment.