August 31st settlement deadline August 31st settlement deadline
Page 1 of 2 12 LastLast
Posts 1 to 10 of 12
  1. #1

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default August 31st settlement deadline

    Back in the dark days of last winter, HMRC extended the deadline by which all settlements would have to be "AGREED" if the loan charge was to be avoided.

    The rule was that applications to settle had to be made before 5th April 2019 and final agreement reached by 31st August 2019.

    HMRC officers have told Parliament that where taxpayers have or are making a genuine attempt to settle, they would not be disadvantaged (presumably by the loan charge).

    Since then (probably before then), HMRC has struggled in pretty much every aspect of this process.

    Applications for settlement have been lost or HMRC has denied receipt. The error rate in calculations remains shockingly high. Speaking to anybody in HMRC who appears to know what they are doing is a lottery. Responses to letters and emails are taking months to arrive. Settlements that are agreed are not resulting in a final acceptance letter, often vital if the lender is going to write off loans.

    There is no realistic hope that HMRC will have processed all applications to agreement stage by their own deadline.

    What happens then?

    Nobody knows.

    We are dealing with a modest number of settlement cases. We have around 70% of those in a situation where numbers are agreed but we do not have the final acceptance letter and as such we cannot advise clients to start making payments under an agreed time to pay. We have 30% of cases where the numbers are not yet agreed.

    We have asked HMRC what happens at the month end to all of these. They don't know.

    We have asked HMRC why they are still encouraging people to apply for settlement even though the deadline is so close? They cannot or will not say.

    We have therefore had to put together some practical guidelines for clients. These are summarised here. These may or may not apply to you. If you are using an agent to help you here, please ignore these and speak to the agent.

    1. If the settlement is not agreed - receipt of acceptance letter - by 31st August, a disclosure for loan charge purposes is sensible to prevent possible penalties arising.

    2. We will then debate the interaction between settlement and loan charge should that remain the situation by the time the 2018/19 SATR is due (31st January 2020)

    3. If the settlement pack is ready aside from final HMRC signature, make an approach to the lender if it is your choice to have the loans written off. They may refuse, but at least you have an audit trail.

    4. Write to HMRC to explain why you have taken these actions (delay in settlement).

    5. Continue sending reminders to HMRC settlement teams

    As I said, your own agent may have different ideas and it makes no sense to pay them for those and then use an anonymous forum poster's views to do something else.

    happy to take questions here but cannot promise to know the answers.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

  2. #2

    Fingers like lightning

    stonehenge's Avatar
    Join Date
    Aug 2013
    Posts
    668

    Default

    And you still think this shower of shyte will pursue all open enquiries after the LC.

  3. #3

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default

    Quote Originally Posted by stonehenge View Post
    And you still think this shower of shyte will pursue all open enquiries after the LC.
    Absolutely, yes I do.

    To think otherwise is, in my opinion, reckless.

    I suggest that all professional advisers would be unwilling to advise a client that paying the LC is anything other than an interim step.

    Unfortunately the LC has generated such a furore and has become such a high profile matter in which everybody and anybody has an opinion, that it has assumed an importance which has eclipsed the normal rules of how tax enquiries are opened, proceed and are settled. There seems to be a widespread conviction with taxpayers that the LC has swept away all of those rules and therefore by killing the LC, everything is good.

    My view may be unfashionable, but as legislation stands today, should the LC fail, we go back to the usual rules.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

  4. #4

    Fingers like lightning

    stonehenge's Avatar
    Join Date
    Aug 2013
    Posts
    668

    Default

    Quote Originally Posted by webberg View Post
    My view may be unfashionable, but as legislation stands today, should the LC fail, we go back to the usual rules.
    That I agree with.

    What I was talking about is, if the LC stands, how much resource will HMRC commit to mopping up open enquiries?

    My guess is if they take any action post-LC, it will be mostly because groups like yours force them into litigation.
    Last edited by stonehenge; 8th August 2019 at 15:28.

  5. #5

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default

    Quote Originally Posted by stonehenge View Post
    That I agree with.

    What I was talking about is, if the LC stands, how much resource will HMRC commit to mopping up open enquiries?

    My guess is if they take any action post-LC, it will be mostly because groups like yours force them into litigation.
    Let's assume that is correct.

    If my group goes to litigation and wins, what will you do about the LC?

    If my group goes to litigation and loses, what do you think a Judge will require of HMRC?

    I'll leave this matter there.

    As I said elsewhere, I prefer to be guided by TMA 1970 rather than an assumption that as far as I can see has no support in statements from HMRC.

    I fear however that we are now boring the onlookers and I will not respond further.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

  6. #6

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default

    I can update this thread unexpectedly as HMRC has made an unofficial response.

    We are told - unofficially - that those who registered to settle pre 5/4/2019 will still have to undertake the reporting of loans by end of September but wont be required to pay the Loan Charge on 31/1/2020 as long as taxpayer still in settlement process and intend to settle with HMRC.

    If true, that is a neat trick.

    It does leave open the question of how to complete the SATR as well.

    Too much to hope of a joined up thinking exercise from HMRC.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

  7. #7

    Still gathering requirements...


    Join Date
    May 2018
    Posts
    93

    Default Thanks

    Quote Originally Posted by webberg View Post
    I can update this thread unexpectedly as HMRC has made an unofficial response.

    We are told - unofficially - that those who registered to settle pre 5/4/2019 will still have to undertake the reporting of loans by end of September but wont be required to pay the Loan Charge on 31/1/2020 as long as taxpayer still in settlement process and intend to settle with HMRC.

    If true, that is a neat trick.

    It does leave open the question of how to complete the SATR as well.

    Too much to hope of a joined up thinking exercise from HMRC.
    Thanks for taking the time to update those in settlement. Are we likely to read the above message from official channels - website update, HMRC Spotlight publication, other?

    I am loathe to take the time to call them, to wait ages to get through before finally speaking to some muppet who knows nothing, promises to get back to you but then doesn't! As happens most times I have tried to contact them!

  8. #8

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default

    Quote Originally Posted by Dmac View Post
    Thanks for taking the time to update those in settlement. Are we likely to read the above message from official channels - website update, HMRC Spotlight publication, other?

    I am loathe to take the time to call them, to wait ages to get through before finally speaking to some muppet who knows nothing, promises to get back to you but then doesn't! As happens most times I have tried to contact them!
    I'd be tempted to wait a week or two.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

  9. #9

    Should post faster


    Join Date
    Apr 2016
    Posts
    114

    Default

    When I called the official settlement help line the agent didn't even know what Time to Pay was - help line really!

  10. #10

    Super poster


    Join Date
    Dec 2014
    Location
    WTT Consulting Ltd - London and online
    Posts
    3,299

    Default

    To the surprise of nobody at all, the 31st August deadline has been quietly dropped.

    See page 6 of this https://assets.publishing.service.go...e_issue_73.pdf

    To get a settlement you now have to comply with the dates in an HMRC letter.

    If you do so, then even if you go over the loan charge disclosure date or possibly even the SATR last submission date, you will not be required to disclose loans.

    To do that in the absence of any actual legislation permitting it, would be a brave shout.

    We are recommending disclosure via the online form regardless of this notice from HMRC.
    Best Forum Adviser & Forum Personality of the Year 2018.

    (No, me neither).

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •