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New loan charge letters from HMRC

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    #81
    Good Afternoon Webberg,

    Thank you very much for your swift responses. I have a couple of additional questions.

    Regarding the answer to question 1. would you be able to elaborate for the uneducated on how the scheme worked. Are all drawings from the partnerships considered "loans" and therefore subject to the loan charge despite me declaring them as taxable income in that tax year? Also since they haven't mentioned the tax years I was using Sunday and VE... should I be declaring them now to avoid any further reprimands?

    On point 2. really? So even if you have conclusive evidence they'll still pursue as if you're lying?

    This is a nightmare.

    Many thanks,

    Will

    Comment


      #82
      I'll indulge you a little further.

      However, I responded on the basis of the information given. Now you have given more information which modifies the answers. I cannot (will not) be able to continue modifying answers as more data appears.

      1. I'm not going to describe Sunday and VE here. Suffice to say I have my analysis and I have seen HMRC's. They consider that the arrangement produces an unintended advantage and is therefore avoidance. Whilst I would agree on some of the facts, there is a chance that HMRC could be wrong as to the advantage. I would rate that chance as good. However the loan charge may make that argument academic at best.

      2. You said you had little evidence, now you say you have "conclusive" evidence. Clearly if you have conclusive evidence of numbers etc, then HMRC will accept what you have provided it is correct.
      Best Forum Adviser & Forum Personality of the Year 2018.

      (No, me neither).

      Comment


        #83
        Originally posted by webberg View Post
        I'll indulge you a little further.

        However, I responded on the basis of the information given. Now you have given more information which modifies the answers. I cannot (will not) be able to continue modifying answers as more data appears.

        1. I'm not going to describe Sunday and VE here. Suffice to say I have my analysis and I have seen HMRC's. They consider that the arrangement produces an unintended advantage and is therefore avoidance. Whilst I would agree on some of the facts, there is a chance that HMRC could be wrong as to the advantage. I would rate that chance as good. However the loan charge may make that argument academic at best.

        2. You said you had little evidence, now you say you have "conclusive" evidence. Clearly if you have conclusive evidence of numbers etc, then HMRC will accept what you have provided it is correct.
        I do apologise if I am annoying you, that isn't my intention at all and I really do appreciate the advice. I'm a little caught in the headlights here. If you don't mind indulging me one last time and I'll leave you alone.

        1. What would I need to declare as a "loan" as a past member of these schemes? I'm very confused about the definition. Would it be the difference in sales vs drawings from the partnership? I do think I have that information in emails.

        2. This was a theoretical question more about the approach HMRC are taking with individuals. Sorry for miss-leading, again it wasn't my intention.

        Thank you again!

        Comment


          #84
          HMRC regard a loan as any amount that was paid to you and which did not attract tax.

          In partnership schemes this usually the difference between profit and drawings.

          I'm not annoyed at all but unfortunately tax is a matter that often turns on very fine details and even the most innocent can make a huge difference.

          I suggest that you search for Von Essen in the threads here. If that shows you little, have a look at Glen May and Aston Mae and Procorre. those are different structures but share many characteristics.
          Best Forum Adviser & Forum Personality of the Year 2018.

          (No, me neither).

          Comment


            #85
            Originally posted by Billm View Post
            Are all drawings from the partnerships considered "loans" and therefore subject to the loan charge despite me declaring them as taxable income in that tax year?
            What sort of income was this declared as? Did you pay tax on it?

            On the face of it, this doesn't sound like loans.

            Comment


              #86
              Originally posted by stonehenge View Post
              What sort of income was this declared as? Did you pay tax on it?

              On the face of it, this doesn't sound like loans.
              Yes, that is what I thought too. I paid income tax and class 4 NIC on the drawings from the partnerships.

              I guess maybe not enough, as they (Sunday and Von Essen) supposedly retained enough funds to pay HMRC (which I did not see). So interpreting what Webberg has said, I may still owe tax on the "undistributed profits" that they didn't actually disburse, and I guess HMRC consider this a "Loan" which is subject to the loan charge.
              Last edited by Billm; 6 August 2019, 13:22.

              Comment


                #87
                Originally posted by Billm View Post
                Good Day All,

                I too received the generic letter a few weeks back (the first correspondence I've had with HMRC about this and first I've heard about the "Disguised remuneration loan charge"). Firstly, I can't imagine what this must be like for those of you with astronomic tax bills/settlements and the havoc it is wreaking on you and your families. It is a disgraceful piece of legislation!

                Perhaps foolishly I called the number on the letter and spoke to one of the drones at the loan charge centre to get some more information about what it was they think I had done (I pretty much had no idea what it was at the time) and provide a time period for which they think I used such a scheme. I have since done some reading and come to the conclusion that they are wrong!

                A week later I received a letter that doesn't seem to be a "We are investigating you letter" but a "We think you were part of this scheme in 2010/11". The trouble is, they think I was using a scheme by the name "Flemming Laing Partnership" which I had never heard of or had ever been in contact with. However, a quick search of this forum leads to some fairly unpleasant reading and suggests that they may have ties to Sunday Solutions / Von Essen (which I did use and was heavily stung by in previous tax years (not 2010/11)).

                Unfortunately I moved house around 6 months ago and went through the obligatory paperwork purge prior to the move. So, I have pretty much destroyed most of my physical paperwork older than 5 years based on HMRC's own guidelines: Business records if you're self-employed: How long to keep your records - GOV.UK

                During the period 2010/11 I was entirely PAYE with Danbro Umbrella (as I wanted the most vanilla umbrella service possible after being stung by Sunday Solutions/Von Essen). I contacted Danbro who very kindly sent me all my payslips from the time. But unfortunately they didn't have my P60.

                I have also contacted the bank I was using at the time for copies of my old statements from the period, however, they weren't overly hopeful that they would still have them (I guess I'll have to wait and see). I do also have electronic copies of my employment contracts covering 2010/11, which clearly state Danbro as my elected umbrella and hourly rate from 2010/11.

                I have a few questions for you all:

                1. I don't believe I have ever received any remunerations disguised as a loan, even when using the Sunday Solutions/Von Essen schemes. Am I wrong, did Sunday Solutions/Von Essen in-fact operate in this way?
                2. Is the information I already have (without bank statements) enough for HMRC to concede that I didn't receive any disguised remunerations during the 2010/11 tax year?
                3. Will HMRC come up with an arbitrary figure if they don't accept my limited figure? If so how will that be calculated?
                4. Have the scheme administrators of the "Fleming Laing Partnership" fraudulently used my name? How can I get the information HMRC used to determine my involvement in the scheme?
                5. Should I seek legal advice? If so, can anyone suggest a reputable specialist where the above is concerned?

                Many thanks, I really appreciate any advice!

                Will
                I too called them, but because i know that i never ever used them for any billing, except i believe they just set me up on their books and i told them a week later i don't want to do any business with them.
                I just called H**C and told them i know for sure i have never used them and i have filed all my tax returns with HMRC during that period and have looked at them going back years. So I know for sure that I have Zero such Loans.
                They told me , they will let their team know and thats it.
                I hope i don't end up with a follow up second such letter.

                But Not sure how they work it out, but i would think as they have everyones tax returns , they could just dump that data from 20 years till now and query it back in some report form to investigate what you say to them on the phone call.

                Let us know how it proceeds

                Comment


                  #88
                  Originally posted by lulaby View Post
                  I too called them, but because i know that i never ever used them for any billing, except i believe they just set me up on their books and i told them a week later i don't want to do any business with them.
                  I just called H**C and told them i know for sure i have never used them and i have filed all my tax returns with HMRC during that period and have looked at them going back years. So I know for sure that I have Zero such Loans.
                  They told me , they will let their team know and thats it.
                  I hope i don't end up with a follow up second such letter.

                  But Not sure how they work it out, but i would think as they have everyones tax returns , they could just dump that data from 20 years till now and query it back in some report form to investigate what you say to them on the phone call.

                  Let us know how it proceeds
                  After calling back to H**C to tell them i never had any such loans. Received another letter after few weeks saying alng the lines of
                  "
                  Thank you for letting them know, however they think i may have benefited from year 200X Assignt Sols (IOM) Ltd. It then asks to check payslips , bank statements from 200X year, and if i find any such amounts then report it while filing SelfAssessment of 18/19. If i am sure that i have not had any such loans confirm this in writing via email at xxx. we may need to ask for more info.
                  "

                  To clarify : I have never used any such loans, but only possibility is that more then a decade ago , Assignt Sols kept cold calling me during that time and one of their sales guys would have by mistake set me up on their books. But as i never used them at all i forgot abt them as no further correspondance happened , except one day a year letter i just got a p45 by post, obviously all figures 0/Zero. again was confused why this p45 considering i never asked them to add me to their list. But anyway that was it. nothing further.

                  Now i know that i have never had any such loans ever. Which is why i called them 1st time round.
                  1) Shld i just email them saying the same in writing as requested ?
                  2) also probably if it helps close the matter also attach my p60 for that 200X year?
                  3) Are these loans ever reported in either P60/P45 at all ?
                  3) anything else.

                  Anyone in the same situation

                  Comment


                    #89
                    Originally posted by lullaby View Post
                    After calling back to H**C to tell them i never had any such loans. Received another letter after few weeks saying alng the lines of
                    "
                    Thank you for letting them know, however they think i may have benefited from year 200X Assignt Sols (IOM) Ltd. It then asks to check payslips , bank statements from 200X year, and if i find any such amounts then report it while filing SelfAssessment of 18/19. If i am sure that i have not had any such loans confirm this in writing via email at xxx. we may need to ask for more info.
                    "

                    To clarify : I have never used any such loans, but only possibility is that more then a decade ago , Assignt Sols kept cold calling me during that time and one of their sales guys would have by mistake set me up on their books. But as i never used them at all i forgot abt them as no further correspondance happened , except one day a year letter i just got a p45 by post, obviously all figures 0/Zero. again was confused why this p45 considering i never asked them to add me to their list. But anyway that was it. nothing further.

                    Now i know that i have never had any such loans ever. Which is why i called them 1st time round.
                    1) Shld i just email them saying the same in writing as requested ? Yes
                    2) also probably if it helps close the matter also attach my p60 for that 200X year?
                    3) Are these loans ever reported in either P60/P45 at all ?
                    3) anything else.

                    Anyone in the same situation
                    If they won't leave you alone, ask your Member of Parliament to write to them.

                    Comment


                      #90
                      The loans would prob not be declared on p60, if you did get any it may just be a line somewhere on payslips. Ultimately if you believe you never actually received any income from loans then tell HM that. I doubt they could prove any different.

                      Comment

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