Hi I've received a letter from the Trust Helpline. I was part of one of the remuneration schemes for contractors. They want me to pay for 5% of the value of a loan to write the loan off. I am a bit confused, as if HMRC says the loan is actually salary, then why would I need to pay any of this?
Email is pasted below and link to the whole explanation is here. Thanks in advance for helping
Uploadfiles.io - Deeds Information Sheet.pdf
You previously let us know that you hadn't decided how to respond to the 2019 Loan Charge legislation. The deadline is upon us and your loans are still outstanding. This means that at some future date, HMRC might argue that inheritance tax is due, the loans could become subject to interest, or repayment could be demanded. Please note that this statement is not a demand for repayment; it merely draws to your attention that it could happen. Many of those contacting us want the reassurance that repayment can never be demanded. If that applies to you, please choose option (c) below.
With regards to your outstanding loans, your trustees suggest you choose from the following three options.
(a) Repay the loans in full. This is unlikely to be attractive to many, since the trustees cannot commit to making a distribution back to those repaying their loans.
(b) Do nothing. This will leave your loans outstanding, which means HMRC might argue that inheritance tax is due, the loans could be subject to interest in future, or repayment could be demanded.
(c) Ask the trustees to write off the loans. The attached help sheet explains how this works. This option has been very popular because the costs are low compared to the alternatives. You should act soon if you want to take advantage of it. The trustees have promised to keep this option open until 15th March 2019.
We’ve attached an information sheet that explains how the write-off works and the costs involved. To proceed, you’ll need to send an email (or forward this one) to [email protected], quoting reference XXX. DOR Resolutions Limited is an Isle of Man company run by representatives of Baker Tilly, an international accounting firm.
DOR Resolutions is increasingly busy with requests due to the pressure HMRC has placed on taxpayers to settle. If you act now, you will have the best chance that the necessary deeds will be sent for signature promptly.
Yours sincerely,
Trust Help Line
Email is pasted below and link to the whole explanation is here. Thanks in advance for helping
Uploadfiles.io - Deeds Information Sheet.pdf
You previously let us know that you hadn't decided how to respond to the 2019 Loan Charge legislation. The deadline is upon us and your loans are still outstanding. This means that at some future date, HMRC might argue that inheritance tax is due, the loans could become subject to interest, or repayment could be demanded. Please note that this statement is not a demand for repayment; it merely draws to your attention that it could happen. Many of those contacting us want the reassurance that repayment can never be demanded. If that applies to you, please choose option (c) below.
With regards to your outstanding loans, your trustees suggest you choose from the following three options.
(a) Repay the loans in full. This is unlikely to be attractive to many, since the trustees cannot commit to making a distribution back to those repaying their loans.
(b) Do nothing. This will leave your loans outstanding, which means HMRC might argue that inheritance tax is due, the loans could be subject to interest in future, or repayment could be demanded.
(c) Ask the trustees to write off the loans. The attached help sheet explains how this works. This option has been very popular because the costs are low compared to the alternatives. You should act soon if you want to take advantage of it. The trustees have promised to keep this option open until 15th March 2019.
We’ve attached an information sheet that explains how the write-off works and the costs involved. To proceed, you’ll need to send an email (or forward this one) to [email protected], quoting reference XXX. DOR Resolutions Limited is an Isle of Man company run by representatives of Baker Tilly, an international accounting firm.
DOR Resolutions is increasingly busy with requests due to the pressure HMRC has placed on taxpayers to settle. If you act now, you will have the best chance that the necessary deeds will be sent for signature promptly.
Yours sincerely,
Trust Help Line
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