Following the independent review of the loan charge by Sir Amyas Morse in December 2019, new guidance and draft legislation have now been published.
If you have clients who are facing the loan charge there are five important things to note:
1. The tax return deadline
Taxpayers can file their 2018/19 tax return and pay the loan charge and any other tax due (or arrange a payment plan) by 30 September 2020 (rather than by 31 January 2020), without penalty. This also applies to those settling or not paying the charge but with ‘loan charge’ issues, such as those whose charge now falls away following the review.
HMRC’s original guidance was not clear that this meant all tax (as opposed to just loan charge related tax), but HMRC has confirmed that they do, indeed, mean all tax. Taxpayers may, however, receive auto-generated interest charges and penalty notices, which can be dealt with by calling 03000 599110.
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Meredith McCammond is a Technical Officer for LITRG and Chartered Tax Adviser, formerly in practice. LITRG is an initiative of the Chartered Institute of Taxation which is a charity. Since1998, LITRG has been working to improve the policy and processes of the tax, tax credits and associated...