Don’t risk HMRC fines.
If you have previously been paid for your work in the form of a loan that was never intended to be repaid, you are liable to pay a loan charge.
The situation may not necessarily be your fault. Loan remuneration practices have always been technically legal, so you might have been mis-sold the schemes as advised by your lawyer or accountant at the time.
Critics of the loan charge have claimed a single lump sum is a harsh penalty for something that was previously allowed. But fear not – improvements to the loan charge were enacted in the Finance Act 2020:
If your employer set up the scheme, then the tax liabilities will fall on them, not you. However, if the employer no longer exists or is offshore, you are liable to pay.
If you have used a loan remuneration scheme, here are your options:
Anybody who wants to settle with HMRC can get in touch with the required information.
Feeling the pinch? Payment plans are available for those on salaries below £50,000 and/or in difficult circumstances, so don’t worry if your financial situation has changed.
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