MPs call on Chancellor and HMRC to offer 'reasonable' settlement opportunity over loan charge
The Loan Charge All Party Parliamentary Group (APPG) has called on the Government and HMRC to offer a “genuine and reasonable” settlement opportunity for those who used loan schemes, which it claims would allow many people to reach affordable settlement and also allow HMRC to collect some of the tax it claims it is owed.
The APPG has also called for a delay of the Loan Charge declaration from the end of September 2020 to the end of January 2021, to allow a six-month period for such voluntary settlement agreements to be agreed.
Sir Mike Penning MP, co-chair of the APPG, said: “The unjust loan charge is now looming for thousands of families who never broke the law and who are being asked to pay sums that are unfair and unaffordable.
“The APPG still opposes the retrospective nature of the loan charge and believes all taxpayers should have the right to access the legal process, but there also needs to be a conclusion to this issue to allow people to get on with their lives.
“So we urge the Government and HMRC to do the right thing and to announce a delay and genuine fair settlement opportunity to allow many people to settle under fair and affordable terms.”
Ruth Cadbury MP, co-chair of the APPG, said:“ “The Loan Charge Scandal is not going to go away as a political issue or as a serious mental health crisis for thousands of individuals without a fair and affordable settlement opportunity.
"It is clear that many people simply will not pay the Loan Charge and many cannot do so. Doing nothing will mean individuals are at risk of bankruptcy, homelessness, breakdown and suicide.
"So we implore the Government and HMRC to do the right thing but also the sensible thing and to announce a six month period for a fair, affordable settlement opportunity and we hope they will listen.”
Sir Ed Davey MP, Co-Chair of the Loan Charge APPG, said: “With this Government determined to press ahead with the unfair Loan Charge, our cross-party group has decided to look for a new arrangement, that makes sense for everyone involved.
"HMRC’s current settlement terms are simply unpayable for most people so produces no money for the Exchequer and only prolongs misery for the taxpayer.
"There needs to be a sensible and fair settlement opportunity that recognises the reality that in many cases it was the promoters of the scheme who benefitted the most, so it is unfair to demand all the disputed tax from a scheme’s user.
"If HMRC offered taxpayers lower and affordable settlements, then HMRC should pursue other losses from the promoters: this is what is needed for a fair and final resolution to the whole issue of the Loan Charge, avoiding many bankruptcies and making it far less likely that any more people will take their own lives as a result of the Loan Charge liability.”
A Government spokesperson said: “The Loan Charge was introduced to tackle disguised remuneration (DR) tax avoidance schemes. It is the view of HMRC that loans made through these schemes have always been taxable. The Government will continue to tackle this and other forms of tax avoidance vigorously.
“HMRC has to be fair to all taxpayers, and this includes those who have already settled their use of DR tax avoidance schemes with HMRC or have never used tax avoidance schemes in the first place. As set out in HMRC’s Litigation and Settlement Strategy, they will only settle for an amount that is consistent with the law.”
“The Government has already extended the deadline for individuals affected by the Loan Charge to submit their 2018/19 Self Assessment tax return to 30 September 2020.”
Editor’s note: first and foremost - and rarely have I written down these words with more sincerity - I hope this finds you well.
Almost certainly you are here because you value the quality and the integrity of the journalism produced by The Yorkshire Post’s journalists - almost all of which live alongside you in Yorkshire, spending the wages they earn with Yorkshire businesses - who last year took this title to the industry watchdog’s Most Trusted Newspaper in Britain accolade.
And that is why I must make an urgent request of you: as advertising revenue declines, your support becomes evermore crucial to the maintenance of the journalistic standards expected of The Yorkshire Post. If you can, safely, please buy a paper or take up a subscription. We want to continue to make you proud of Yorkshire’s National Newspaper but we are going to need your help.
Postal subscription copies can be ordered by calling 0330 4030066 or by emailing [email protected]. Vouchers, to be exchanged at retail sales outlets - our newsagents need you, too - can be subscribed to by contacting subscriptions on 0330 1235950 or by visiting www.localsubsplus.co.uk where you should select The Yorkshire Post from the list of titles available.
If you want to help right now, download our tablet app from the App / Play Stores. Every contribution you make helps to provide this county with the best regional journalism in the country.
Sincerely. Thank you.