The loan charge is NOT a settlement "option"

[webberg]

Thanks for the above. Can you then clarify the below extract from the HMRC website then?

As well as returning and paying the loan charge, you’ll still have to settle any enquiries into the DR schemes or take your case to a tribunal or court if you are unwilling to settle. Where you have paid the Loan charge, there’s a double tax rule to ensure you do not have to pay tax twice on the same income.

It says that if you have paid tax on the same amount as is taxed under the loan charge, then the loan charge will not apply.

It says that where the loan charge is paid, it will be a credit against tax later found due on that income in the year it was paid.

Nowhere does it say that HMRC will walk away from open enquiries.

[webberg]

Thanks - and if there is no enquiry into a tax year and I voluntary declare the loan amounts and pay the loan charge, is that the end of that issue?

There is no "voluntary".

You are required by law to disclose loan amounts that are subject to the loan charge.

This is the situation regardless of whether the year the payments were made is open or closed.

[Superfly]

It says that if you have paid tax on the same amount as is taxed under the loan charge, then the loan charge will not apply.

It says that where the loan charge is paid, it will be a credit against tax later found due on that income in the year it was paid.

Nowhere does it say that HMRC will walk away from open enquiries.

It sounds like the loan charge effectively forces people to make a pseudo-CTD payment, but without the ability to reclaim any differential back if it is later found that you have overpaid.

Similarly a CTD payment would not close down an open enquiry, the enquiry would still have to run its course.

[regron]

It sounds like the loan charge effectively forces people to make a pseudo-CTD payment, but without the ability to reclaim any differential back if it is later found that you have overpaid.

Similarly a CTD payment would not close down an open enquiry, the enquiry would still have to run its course.

I find the best way to describe it, is like a non-refundable APN.

[Confusedetc]

“Paying the loan charge does not resolve underlying Tax disputes you may have with us for the years in which the loans were made.
Tax years are subject to an open inquiry or assessment will still need to be resolved, either by way of settlement with HMRC or through litigation.”

I am going through paying the loan charge as I was too late to settle, yet nobody at HMRC has a clue about the above and how I go about settling or litigation.
Literally every time I call I get passed around 10 different people (this is once I start at the loan charge helpline).
It's very frustrating.
Just want to get it sorted and put behind me, yet HMRC have no idea.

[EBTContractor]

We have been advised that HMRC has agreed that if the loan charge is paid they will close all enquiries by perhaps a dozen clients .

And how will they work out if theres a balance to pay if LC was less than the settlement route pre 30 Sep?

[eek]

And how will they work out if theres a balance to pay if LC was less than the settlement route pre 30 Sep?

Please don't misquote people by only quoting the line you want in an important post...

For reference the entire quote is

We have been advised that HMRC has agreed that if the loan charge is paid they will close all enquiries by perhaps a dozen clients now.

Those with written "evidence" from HMRC have sent that to us.

In every case the words used by HMRC do NOT say that they will stop or give up enquiries.

I'd be delighted if I could get my hands on incontrovertible evidence but to date, I have not.

which says that what the client is telling webberg HMRC told them isn't exactly what HMRC thought they were asking.

[EBTContractor]

interesting in that just come off the phone and and confirmed by HMRC if I declare on my SATR and pay the loan charge the case is closed. Obviosuly I know from some learned on here that is actually not true. Interesting or not but I made it absolutely clear in my questioning in once I agree the payment for the loan charge that is my case for those years closed....reply "yes sir"

I was told this as well on 29 Sep, by a lady in the Cardiff office (name, date time recorded). She said if you declare your loans on the form, do your SA18/19 and pay what you've declared, we will close the enquiries (provided you've told us the truth, if not and we do checks within 12 months, we'll come after you again).

[regron]

Ask for the closure notice stating no more tax due. Otherwise what they said is worth Jack.

I was told this as well on 29 Sep, by a lady in the Cardiff office (name, date time recorded). She said if you declare your loans on the form, do your SA18/19 and pay what you've declared, we will close the enquiries (provided you've told us the truth, if not and we do checks within 12 months, we'll come after you again).

[webberg]

I was told this as well on 29 Sep, by a lady in the Cardiff office (name, date time recorded). She said if you declare your loans on the form, do your SA18/19 and pay what you've declared, we will close the enquiries (provided you've told us the truth, if not and we do checks within 12 months, we'll come after you again).

Said "lady in Cardiff" is wrong.

Even if you had obtained from her that wording in a written format, I suspect HMRC will deny it.

It would appear that the internal communications on this matter within HMRC have been interpreted by some as above. Hardly surprising as many contractors also came to that false conclusion.

It would appear that what the HMRC officers mean is that if they check the 18/19 SATR and the loans have been disclosed and the loan charge raised, then no enquiries will arise on 2018/19.

That is a long way from saying that they will give up their enquiries from earlier years.

It's easy to see in a discussion where both parties have a less than complete understanding and differing goals, you can take away the claimed result that they hoped for.