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MPs force loan charge review

11th Jan 2019
Big Ben and Houses of parliament, London
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A cross-party group of MPs has secured an amendment to the Finance Bill forcing the Treasury to review the effects of its 2019 loan charge measure.

The government was yesterday forced to rethink its controversial loan charge tax avoidance plan after MPs backed an amendment to the Finance Bill tabled by former Liberal Democrat environment secretary Ed Davey.

Amendment NC26 requires the Chancellor to review the effects of the loan charge legislation and provide the House of Commons with a report by 30 March 2019, and was tabled after a sustained campaign from opponents of the charge who claimed it would unfairly punish, and in some cases bankrupt, tens of thousands of contractors and agency workers who had used disguised remuneration schemes.

Initially proposed in the 2016 Budget, the tax charge on certain loans to contractors and employees – often labelled disguised remuneration schemes – has attracted a huge amount of controversy. This is due to its retrospective nature, which allows HMRC to examine arrangements going back almost 20 years, and the fact that those found to be using such schemes could face a charge for those 20 years of income tax in a single tax year (with one taxpayer allegedly given just 18 days to pay a tax demand of £153,000).

Charge still due to come into effect

The review will not in itself bring an end to the loan charge uncertainty for those affected by the measure.

Loan charge rules are already law, contained in F(No 2)A 2017, Sch 11 (with supplementary changes in FA 2018, Sch 1). Responding to the amendment, Financial Secretary to the Treasury Mel Stride commented that the government was happy to review the effects of the loan charge, but insisted that such ‘disguised remuneration’ schemes were “gross aggressive tax avoidance”, and that the outstanding tax remained due.

In a letter to all MPs prior to the amendment Stride claimed that the legislation itself was not retrospective.

“The schemes never worked under the law that existed at the time they were used,” said the letter. “A number of court successes, including in the Supreme Court, support the view that the payments to the individuals were always taxable as income. Even without the loan charge, HMRC would be legally obliged to pursue the tax due.”

An HMRC spokesperson confirmed that the charge would still come into effect on 5 April 2019. “The amendment does not change the legislation but will ensure that a review of the impact of the loan charge is published before that date,” said the spokesperson.

“We want to do all we can to make it simple for people to get out of these schemes and we’re here to help. Anybody who is worried about being able to pay what they owe should get in touch with HMRC as soon as possible on 03000 530 435”.

Impacts of the charge

In a policy paper published in 2017, the tax authority stated that it expects the measure to affect up to 50,000 individuals and the Revenue has previously stated that it expects to protect around £3.2bn in tax by tackling such avoidance schemes.

While HMRC’s policy paper gave an estimate of the number of taxpayers potentially affected by the charge and the charge’s impact on Exchequer tax receipts, a recent Freedom of Information request has highlighted that no work has been done around how many individuals are anticipated to become insolvent, either at the time of writing the Policy Paper or using up-to-date information.

The policy paper says that the measure “is not expected to have a material impact on family formation, stability or breakdown”.

However, according to campaigners, representative bodies and politicians, this has unfortunately not proved the case. In 2017 the ICAEW flagged up the potential hardship the charge will cause in certain cases, while a House of Lords committee charged with investigating the loan charge was “inundated” with letters about the impact the scheme was having, some of which he labelled “heart-breaking”.

In an article for AccountingWEB in 2017, RSM’s Andrew Robins also flagged up HMRC’s unwillingness to change its settlement terms, even where the tax at stake is enough to result in financial ruin for the taxpayer. HMRC’s attitude is heavily influenced by its view that loan arrangements are abusive tax avoidance, and cracking down hard on affected taxpayers is a way to send a signal discouraging anyone from undertaking similar ‘tax planning’ in future.

‘Hope to thousands of innocent people’

While the decision does not mark the end of the loan charge, it has marked a shift in government thinking on the measure. Following the passing of the amendment, Davey tweeted that he felt it was “an outrageous attempt at retrospective tax” and that that decision “gives hope to thousands of innocent people”.

Commenting on the amendment, Steve Packham from the Loan Charge Action Group told AccountingWEB that campaigners were pleased the government has been forced into reviewing the loan charge and were extremely grateful to Sir Ed Davey and the MPs from all parties who secured the review.

However, Packham expressed concern that the Treasury would use the review to conduct a “meaningless whitewash”.

“[The Treasury] and HMRC have spent months misleading MPs with cynical propaganda and the Minister’s speech was ungracious and factually wrong,” said Packham. “There are no court judgements that justify the loan charge on employees, as he well knows, and the arrangements were known to HMRC who accepted people’s tax returns and did nothing.

“With families facing bankruptcy and homelessness, it is time ministers finally listened and accept that this policy is deeply flawed, profoundly unfair and will cost lives. If they fail to listen in the face of such overwhelming opposition in Parliament, they will be knowingly allowing this to happen which is frankly unforgivable.”

Another high-profile opponent of the measure is Lord Forsyth, Chairman of the House of Lords Economic Affairs Committee, who called the loan charge “unfair” and “pernicious” in a recent interview with AccountingWEB following the release of a report on HMRC powers.

Lord Forsyth welcomed the review but cautioned that it must result in meaningful action.

“We urge the government to listen to the people who contributed to our December report,” said Lord Forsyth. “They face crippling bills from HMRC. These people do not earn high incomes and entered these schemes under false assurances that they were legitimate.

“The government should remove all those who told HMRC they were participating in these schemes from the charge, and they should set up a dedicated helpline.”

Replies (39)

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By Justin Bryant
14th Jan 2019 10:00

Well done to Sir Ed Davey & Lord Forsyth. They should be congratulated for challenging this scandalous retrospective tax charge and the total disingenuousness (not to mention deceit) of HMRC and others who (through their evil motives) support it.

Also, without their great work we would probably not have got this small but useful concession:

"As the right hon. Gentleman will know, HMRC has recently come forward to say that those earning £50,000 or less—which is over twice the average national salary of somebody working in our country—will automatically be granted, without requirement for additional paperwork, a minimum of five years’ time to pay as an arrangement to settle their affairs."

https://hansard.parliament.uk/commons/2019-01-08/debates/1EC25998-330C-4...(No3)Bill

See also: https://www.step.org/news/appeal-magna-carta-forces-uk-government-recons...

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Replying to Justin Bryant:
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By BlueNose1812
11th Jan 2019 10:57

It is hardly "a scandalous retrospective tax charge".Back in 2009 I warned a client not to enter into such a scheme and that retrospective legislation was a distinct possibility. He thought he would be a minnow in a massive shoal of sharks and HMRC wouldn't have the resources to chase him. Anyone who entered into an avoidance scheme must have been financially sound at the time. They just gambled and lost.

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Replying to BlueNose1812:
By djn24
11th Jan 2019 13:05

BlueNose1812 wrote:

It is hardly "a scandalous retrospective tax charge".Back in 2009 I warned a client not to enter into such a scheme and that retrospective legislation was a distinct possibility. He thought he would be a minnow in a massive shoal of sharks and HMRC wouldn't have the resources to chase him. Anyone who entered into an avoidance scheme must have been financially sound at the time. They just gambled and lost.

I agree. The whole arrangement was sham and they owe the tax.
I feel a bit of sympathy for them but they owe the tax.

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Replying to Justin Bryant:
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By Exfoliate
12th Jan 2019 08:27

Kind of HMRC to give some hard up tax payers 5 years to pay.

Pity they set a date in stone for the repayment of the loan instead of giving tax payers 5 extra years from 5/4/2019 to repay it so allowing them opportunity to avoid the tax charge in the first place.

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By enanen
11th Jan 2019 10:37

I'm sorry but you had had the money now pay the tax like the rest of us!

Why should you not require to pay the tax due on madey-uppy tax schemes?

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Replying to enanen:
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By moneymanager
11th Jan 2019 11:20

In which case what justifies the dissallowance of loss relief on a loan used in a Sale & Leaseback film partnership, the ongoing tax on the revenue stream, which was always going to be the case and with the increase from 40 to 45% HMRC is getting back more than it would have done. The labelling of tax deferal as "aggressive tax avoidance" is language worthy of "1984" not that of a taxing authority in a supposedly democratic country.

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Replying to moneymanager:
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By Justin Bryant
23rd Jan 2019 11:24

Yes. The fact that Mel Stride used that phrase to describe EBT planning indicates that he doth protest too much - that phrase should only be used for properly aggressive and abusive tax schemes like that in the links below:

https://www.gov.uk/government/publications/the-cup-trust-charity-commiss...

https://www.civilsociety.co.uk/news/man-behind-charity-tax-avoidance-sch...

https://www.step.org/news/cup-trust-charity-tax-avoidance-affair-showed-...

Also, if it was such grossly aggressive tax avoidance how come it was approved as legal by every court and tribunal for the past 20 years or so until Julian Ghosh QC pulled the wool over the SC's eyes in Rangers by arguing it was actually redirected earnings - a point the SC found to be so obvious that pretty much every judge and lawyer (including HMRC of course) had completely overlooked it until then!?

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By johnjenkins
11th Jan 2019 10:39

Had HMRC done their job properly 20 years ago, this would never had happened.

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By Ian McTernan CTA
11th Jan 2019 11:23

Have to wonder why MPs would support this but not challenge a real tax grab like Section 24.....

As I always avoided these tax dodging schemes I am pleased to report none of my clients are affected.

It was clear at the time the schemes were 'something for nothing' and what we really need to see is those who pushed these schemes being liable for the tax - either through HMRC action or professional bodies.

In the end, as usual, those who got rich promoting the schemes will get away with their ill gotten gains while the taxpayers will end up with the bill.

Time to pay would be a good thing, a statutory amendment to deem that time five years would be welcomed. That would give enough time for at least some of the taxpayers to recover the money from their advisers who pushed the scheme.

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By Michael C Feltham
11th Jan 2019 11:42

“[The Treasury] and HMRC have spent months misleading MPs with cynical propaganda ..."

What? A Government Agency misleading august Members of Parliament?

So what, he quoth cynically it is happening all the time!

Plus HMRC are probably the lead agency for "Mirror Management" tactics. (I define Mirror Management as those manager who reflect upwards views they believe the bosses want to hear, rather than fact and truth!).
Brexit lies from Remainer Ministers and Mandarins of Whitehall being yet another example.

All it takes in these benighted days, to really please MPs relying on empty rhetoric and soundbites, is a nice warming scandal labelled "Aggressive Tax Avoidance" and they are off to the races.

My own major concern is Government and HMRC's abuse over Retroactive and Retrospective legislation and their blase attitudes towards this. How long will it be before some fool in Treasury advises a Chancellor of the Exchequer, that a 20% Income Tax Rate was incorrect back in 2007 and therefore HMRC would retroactively demand 5% from each and every taxpayer for each year plus interest!

Well done Steve Packham and all who fought this; and thanks be for Lord Forsyth. He demonstrated far greater wisdom, comprehension and ability as Chair of the Lord's committee on the 2018 sessions, particularly when he and his committee members gave that fool Middleton a grilling and her boss Ruth Stanier; an even bigger fool!

Watch it here:

https://parliamentlive.tv/Event/Index/99ca5180-ad74-4833-bb81-fdc8612f53ed

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By Robbo
11th Jan 2019 11:45

While many subcontractors had to set up PSC's they had a choice as to whether to join these schemes. If it appears too good to be true, it probably is.
THe rest of us who have avoided these high risk schemes should not be making up the shortfall in tax.

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By johnjenkins
11th Jan 2019 12:18

That's another fine mess you got me into, Tony.

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By pauljohnston
11th Jan 2019 13:48

I dont think the compalint is about not paying the tax its about making people bankrupt and the like.

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Replying to pauljohnston:
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By BlueNose1812
11th Jan 2019 14:07

pauljohnston wrote:

I dont think the compalint is about not paying the tax its about making people bankrupt and the like.

Just like the sole trader who spends all his income and then complains when the tax bills and baillifs arrive.

In the EBT case I have, one partner soon started spending his "loan" and is now pleading poverty.

Strangely his FD just put the windfall on deposit and is in a slightly better position. However he is ruing the £300k in fees that went up in smoke. An expensive couple of hundred templated pages of waffle and blather. I am sure the architect of the scheme is duly contrite and will do the right thing !

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Jennifer Adams
By Jennifer Adams
11th Jan 2019 18:12

>>>Can I just explain something to those who think this is 'fair do's' - nana for example.
I have a client who was caught up in this through no fault of her own.
I was going to write this as a comment under the article but then thought it would be better (as in more detail) under a blog. So please direct here:
https://www.accountingweb.co.uk/community/blogs/jennifer-adams/response-...
>> my client is very upset about this - she didnt understand. I have been assured by HMRC that my client is not the one being investigated, but has just been caught up in something that was not her doing. 8 months on and there has been no confirmation or letter of offer from HMRC.

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By Exfoliate
12th Jan 2019 08:03

"with one taxpayer allegedly given just 18 days to pay a tax demand of £153,000"

Anyone notice the flaw in this article?

How can a tax payer be given 18 days to pay when the loan charge doesn't come in to effect until 5th April 2019 ? And only presumably then when the HMRC has established with the trustee and the tax payer the loan hasn't been repaid. Or is this a case of HMRC having foresight over a tax they have introduced with the benefit of hindsight. With such abilities - no need to go to specsavers then !

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Replying to Exfoliate:
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By AnnAccountant
12th Jan 2019 21:49

Yet another example of the deceit that is used by those on that side of the fence.

I don't think they will ever tell the truth or take any responsibility for what they did.

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Replying to AnnAccountant:
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By Exfoliate
13th Jan 2019 09:01

And your point to my comment ?

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Replying to Exfoliate:
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By AnnAccountant
13th Jan 2019 13:09

Erm - agreeing with the flaw you had pointed out

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Replying to AnnAccountant:
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By Exfoliate
14th Jan 2019 07:58

Ah OK I didn't get that, sorry. I was more reading your comment of the deceit and lies by those on 'that side of the fence' to which I assume you refer to those involved in these schemes?

Throughout my threads on the subject you may understand I used an EBT but did NOT make non-repayable loans, nor did the EBT make loans to me personally. So where HMRC say 'loans' should be repaid or there are consequences', I agree, where they say loans must be repaid in CASH within TWO years - I don't agree. I think any loans made which HMRC think are maybe sham loans should be repayable in whatever form is reasonably acceptable, thus returning the 'assets' to the trust, following which any future extraction is then taxed. I think the time period for repayment is too short for those in financial difficulty. And I think
HMRC should NOT be allowed to go back further than the time originally allowed, ie. in this case they are out of time if they did not protect their position within the four year period.

My point is, I am on that side of the fence, there is no lie or deceit, just unfortunate collateral damage to which HMRC don't wish to engage in reviewing my particular set of circumstances.

Conclusion HMRC should re-think the boundaries of the loan charge.

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Replying to AnnAccountant:
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By Exfoliate
14th Jan 2019 08:09

p.s. I don't suppose Ann your sympathy would extend to the fact that as a result of this loan charge and as a result of HMRC's refusal to deal with my case, I have been forced to sell the settlor company (having no immediate liquid funds), for a price far below it's realistic value as a result of this 'contingent liability'. That one little word 'cash' and allowing HMRC to go back years beyond their set time limit, being the only and direct reason I have made a huge financial loss, which incidentally isn't tax deductible against all those previous years profits I did pay my tax on.

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By Exfoliate
12th Jan 2019 08:40

The article states HMRC expects to protect around £3.2bn in tax by tackling such avoidance schemes. How much of this £3.2 bn it now intends to protect formed part of their own ineptness by being 'out of time' and failing to protect the tax in the first instance? Doesn't this give HMRC an unfair advantage of a second chance ?

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By EnglishRose
12th Jan 2019 10:00

So I have paid full tax as a sole trader, with no dodgy loans, since 1994 and those who have cheated the state, pout up my taxes, used schemes which most of the rest of us would not touch with a barge pole might get this review?

It is not new that HMRC can go back as far as they like if there is fraud. It is not new that these schemes were "well dodgy". I do not accept the loan charge arrangements are retrospective tax. Also can't people just pay back the loan and avoid the tax?

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Replying to EnglishRose:
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By Exfoliate
13th Jan 2019 09:12

So where the trust is used to loan money on commercial terms to a company (owned by similar directors of the settlor) for purely and solely commercial reasons charging commercial interest and with security, and that company has the ability and the will to repay the trust loan at the conclusion of the term, just because HMRC have now set in stone a repayment date of 5/4/2019, why should that give rise to a 61% tax charge on the settlor, and the paye part transferable to the directors personally if the settlor cannot pay. No tax saving just a horrendous retrospective tax bill . You think that fair?

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By anne in basingstoke
12th Jan 2019 15:04

A helpline sounds a good idea BUT I always wondered why anyone, especially tax advisers, would think paying someone 'disguised remuneration' was a good idea. When I first studied accountancy, a legal case came up which, in its outcome, established (or so I thought) the notion of 'substance over form'. Such a concept is about looking at what really is going on and enables HMRC (or anyone else with integrity) to look through the paper circumstances and dismiss them, when they are so contrived, for what they are. It saddens me to think of so many people being caught up in their employer's enthusiasm to save money (such as employer's NIC) and appear modern, that they so unthinkingly accept such forms of remuneration. If something seems 'too good to be true' it probably is. I am most disappointed that it has taken HMRC so long to get their heads around confronting these schemes that people affected could end up being bankrupt. I would like to think that where the scheme details have been available to HMRC, then HMRC should not be able to go back more than about 4 years for an initial challenge, certainly not 20. And it should be the employer who is penalised in the first instance, not the employee. Also the legal advisers should take a hit. Fellow accountants, while having compassion, and campaigning for HMRC to also act in a compassionate manner, let's ourselves act with integrity. Taxes and NIC need to be paid for our country to run well. We should be supporting the lawful collection of the same and not thwarting it.

It may be that some of you do not like my remarks. I do ask, however, that you restrict yourself to courteous responses. Thank you.

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Replying to anne in basingstoke:
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By Exfoliate
13th Jan 2019 09:28

I think you are absolutely right, the point however is, HMRC have in many cases failed to protect their position within the respective four year period and the government have now allowed them a second shot to cover their own failures. In that aspect it's a case of having an unbalanced playing field between tax payer and tax man. That doesn't seem fair play.

And as I understand it, the loan charge is firstly chargeable against the employer and only if the employer fails is the paye (not the nic) part then recoverable from the employee. I think that's correct?

What I am unsure about however, and if anyone knows it would be interesting to hear, is that HMRC presumably plan to issue the employer with a paye/nic notice based on the employee's earnings for the tax year ending 5/4/2019. What if the employee no longer works for the employer and what if the employee is no longer UK tax resident? How's that going to work in practice and presumably the company if it was able to pay would be unable to deduct the loan write off and/or the tax thereon, as it's not a wholly, necessarily and exclusively expense?

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By Justin Bryant
14th Jan 2019 11:13

Even if you know nothing about the history and details here (and you can’t be bothered to read up on it all – I don’t blame you there), what's more likely? That Sir Ed Davey and Lord Forsyth and the 100 odd other cross party MPs have somehow been hoodwinked by 1000s of grossly aggressive tax avoiders (as Mel Stride puts it) or that HMRC are being duplicitous and the likes of Ann Accountant don't know what they are talking about (or are being equally if not more duplicitous here)? I rest my case as they say.

I also note per the link below that CIoT is supportive of this review and they are not normally in the business of siding with grossly aggressive tax avoiders are they (quite the opposite in fact)?

https://www.lexisnexis.com/tolley/guidance/corporatetax/linkAlertDoc.fac...

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By Trethi Teg
14th Jan 2019 12:33

What a bunch of hypocrites you are!

I would bet my last pound that all of you that have pontificated have put expenses through your own practice accounts that HMRC would never allow and claimed back vat on personal items of expenditure you have put through your practices. I am confident that every one of you are fully aware of clients who have deliberately underdeclared sales or overdeclared expenses yet have done nothing about that let alone report them to the appropraite authorities. I have little doubt therefore that you are both guilty of tax evasion and conspiracy to avoid tax (both criminal offences) and yet you are very quick to criticise those who have legitimately reduced their tax bills. John 8:7.

If any of you are whiter than white and followed the letter of the law then I withdraw my accusation and apologise.

The arrangments entered into were legal (morallity is a different matter) and there is a whole trail of case law to demonstrate this. It was only when the powers that be decided to introduce the concept of "what parliament intended" as opposed to the actual law did we find that these arrangments were suddenly illegal.

I have no argument with the authorities declaring that EBT loans are taxable for future transactions, but going back 20 years is something for which you should all (as accountants looking after your clients interests) be putting on your yellow high vis jackets and storming the houses of parliament.

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Replying to Trethi Teg:
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By AnnAccountant
14th Jan 2019 16:42

A scheme being legal and being taxed in the way you would like are two different things.

Why do the schemers always bring up the "I did nothing illegal" argument?

Defo no sympathy post the DR rules. A bit for users before that line was drawn.

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Replying to AnnAccountant:
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By Trethi Teg
14th Jan 2019 17:55

Can't make sense of the first line -please explain.

"I did nothing illegal" is perfectly correct.

Notice you didn't mention whether you have ever done anything wrong or turned a blind eye. Would you like to answer that now?

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Replying to Trethi Teg:
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By Exfoliate
15th Jan 2019 08:07

Before we all descend in to a remain, leave or second referendum morality argument, does anyone have an answer to my earlier question please ? ie. how's it going to work in practice? I'm a little too old in the tooth to keep up with all this, but have a vested interest so if anyone could help I would be grateful.

The closing of a loophole to what parliament intended should be done quickly and apply only to future events not past. That would I think get agreement with all.

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Replying to Trethi Teg:
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By AnnAccountant
15th Jan 2019 14:26

If the police wish to come and see me about any (minor) crimes committed over my life, they are free to do so. I'm not sure that their failure (to date) to do so affects the Loan Charge rules or the validity of my opinion on this whole matter though.

Btw - If you are quoting the bible at me - and especially if you think it should be literally followed - you are either desperate or trolling or both. Probably both. Ok, I'll allow myself to be trolled a little between work....

Are you actually saying that, if a policeman stops you for drink driving but he stole a chocolate bar from a shop when he was 12, he is not allowed to arrest you? A world where no one can deal with the bad behaviour of others because they once committed some unrelated and minor offence themselves sounds like a terrible world. If we lived in that world, you might get away with your non-payment of tax but that would be the least of your worries when large and (in your Utopia, unarrestable) people came round to your house and took all your tax-free loot.

Be careful about applying the bible too literally. I mean, don't take it as gospel! :)

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Replying to Trethi Teg:
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By I J Lessels
15th Jan 2019 15:57

Hi Trethi - which translation of the bible are you using? I don't quite recognise it.
Since it is a matter of fact that only JC himself is without sin, are you arguing that all law and law enforcement should cease in the absence of perfect people? Just wondering...

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Replying to I J Lessels:
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By AnnAccountant
15th Jan 2019 17:48

I'm curious as to what Matthew (the tax collector disciple) and the infamous "moneylenders" would have made of DR schemes.

All I can find is a verse of Matthew that is included in the Tolleys Yellow Tax Handbook:

Lo, the taxpayer brought forth and presented to the moneylenders a set of magic template documents, the originals of which he said had been chiselled by Moses himself with the word of Clavis and said unto them, "I will give you 90% of my earnings and you will give me an interest free loan that I will never have to repay."

[End quote]

Matthew's view of the tax treatment of scheme doesn't survive. Even if it did, Treth would probably argue that he had stained the paper with tea and backdated it or something.

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By gordo
16th Jan 2019 13:22

It seems many apparently are unaware that the decision by the Supreme Court in Rangers, did not deem loans to be taxable, indeed quite the opposite, they concluded that there were redirected taxable earnings before any loans were made. https://www.taxadvisermagazine.com/article/loan-rangers-–-whod-be-ref

So the amounts that went into Trust and were then loaned back have already been subject to tax under the law. The same sums cannot be taxed twice and Disguised Remuneration is completely different and separate to redirected earnings. So the 2019 Loan Charge is arguably in defiance of the decision of the Supreme Court.

You may also not be aware that in the same breath HMRC are arguing that loans released by the Trust would be the release of a properly constituted loan and thereby potentially subject to IHT. So in the one breath these sums are three different things, all at the same time, according to HMRC's whim. Redirected earnings when they can tax the employer, Disguised Remuneration when they can't get to the employer and want to pursue the individual, loans for the purposes of IHT and for the purposes of a new charge on loans.

Many accountants seem unworried that HMRC have proposed a new law that brings back into charge amounts that the taxpayer may have had every reason to believe were finalised; where they had no open enquiries, more than four or six years may have passed and they are not caught by the decision of the Supreme Court, nor accused of fraud. The normal time limits of enquiry of 4 and 6 years are simply overridden by the new loan charge, making a mockery of all the protections previously put in place by...Parliament.

Some posters insist that the loans were a sham, despite the Courts ruling that loans were real and properly constituted. Indeed HMRC have never claimed that the loans were a sham.

Some may not be aware that in the recent Finance Bill debate, the House essentially told the Government that it was not happy that legislation, which was retrospective in its effect, had been introduced without the House having been fully aware of it, and the MPs demanded a review of the loan charge. It would appear that the committee who debated the original bill were not given time to consider the representations submitted and Mr Stride hurried through the reading of the bill (that's on record).

The Lords Economic committee say that the Loan Charge is retrospective in it's effect. The ICAEW said in 2016 in response to the initial 'consultation': "We are very concerned about the proposals as they contavene generally accepted notions of fairness and break the constitutional convention against retrospective legislation, imposing tax charges where taxpayers already had legal certainty that none were due.".

I hope those who know better than the Courts, the Lords and the ICAEW don't regret it when HMRC turn their attention in full to IR35 next year.

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Replying to gordo:
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By Trethi Teg
17th Jan 2019 14:03

Thank goodness there are others out there - gordo - that see the really important issues here rather than those who seek to moralise.

As far as the other responses to my e mail are concerned no one has yet come forward to say that they have done nothing wrong. I can therefore safely assume that you have all been "at it" and are guilty of a criminal offence as well as being hypocrites.

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Replying to gordo:
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By Trethi Teg
17th Jan 2019 14:03

Thank goodness there are others out there - gordo - that see the really important issues here rather than those who seek to moralise.

As far as the other responses to my e mail are concerned no one has yet come forward to say that they have done nothing wrong. I can therefore safely assume that you have all been "at it" and are guilty of a criminal offence as well as being hypocrites.

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Replying to Trethi Teg:
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By I J Lessels
04th Apr 2019 15:49

No, Trethi, I have committed no criminal offence. Does that mean I win the argument now?

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By Exfoliate
18th Jan 2019 08:50

When discussing morality issues there will always be hypocrites, I think throughout AccountingWEB blogs on EBT's we know mostly where everyone sits and I doubt anyone will change their views, hypocrites or not. There has however been complete silence to my question of how HMRC propose in practice to issue a PAYE and NIC charge to the settlor company on unrepaid in cash loans as at 5/4/2019 where the employee is either no longer employed and/or is no longer UK tax resident? And is the cost tax deductible for the company ? I doubt the ex-employee is going to be accommodating to the company in trying to understand its position. Can anyone help or are well all in the dark? Thank you.

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