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Disguised remuneration is a kind of tax avoidance scheme that pays people income via a loan – but a loan that was never meant to be repaid.
However, since 2019 HMRC has started to crack down on these disguised remuneration schemes through something called a “loan charge” – basically asking for Income Tax and National Insurance (plus penalties) to anyone who used these schemes, on disguised remuneration loans starting all the way in 1999.
There are also different rules now for how companies can give loans, especially to directors:
Otherwise, the loan is considered a “benefit in kind” and you have to pay tax on it.