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Reporting requirements for those impacted by the April 2019 Loan Charge

David McManus

David McManus | Personal Tax Manager

Thursday 30th May, 2019

Those who used a disguised remuneration scheme and had an outstanding loan (i.e. have not settled or repaid the loans) on 5th April 2019 are now liable to the Loan Charge and need to take action if they have not done so already.

Scheme users who provided HMRC with the necessary information by 5th April 2019 have until 30th September 2019 to settle or face the Loan Charge. The introduction of the Loan Charge does not mean however that HMRC will be closing any years where they have already opened enquiries.

If you have any outstanding disguised remuneration loans and the employer at the time you took the loans from no longer exists (or is not based in the UK), you have until 30th September 2019 to tell HMRC about the loans using their online service. The loan charge would then need to be declared on the 2018-19 self assessment return which needs to be filed and the liabilities paid by 31st January 2020.

HMRC have also been clear that, if inaccurate information about outstanding loans is provided to them before 1st October 2019, they will take action in the form of penalties. Similarly, in cases where people fail to pay the Loan Charge, HMRC intend to use penalties, interventions and information powers as needed to encourage compliance.

Related article - Update to HMRC Tax Avoidance documents

HMRC are increasing their focus on tax evasion and "unacceptable" tax avoidance. The ‘Tackling tax avoidance, evasion, and other forms of non-compliance’ policy document has now been updated to include the anti-avoidance measures announced in the Budget 2018 and also to confirm their current approach and how they intend to meet their goals of preventing tax avoidance and tax evasion.

Read more here
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