Working with a couple of clients looking to settle with HMRC.
Usual scenario - employer company paid a sum to a trust, which then set up sub trusts which loaned money to the individuals. April 2019 charge will apply.
Tax enquiries have been open for a number of years (4 years’ worth of returns) and there doesn't seem to be any impending "day in court" so to speak. APNs have been issued but are currently subject to judicial review. Long story short, there's next to no chance that the tax case will be settled by 5 April 2019.
Which brings me to the April 2019 loan charge. From what I can gather, assuming this is not repaid, this is going to apply regardless of the success of the underlying tax cases.
Assume for a minute we have an extra efficient court system which managed to hear the case at the FTT all through to the supreme court and it decides that my client's scheme was fine (no laughing at the back), i.e. not a disguised remuneration scheme. Is the tax paid under the loan charge then lost?
Or does the fact that it is deemed not to be a disguised remuneration scheme mean the loan charge doesn’t apply?
I hate EBTs…