Final call for contractors to complete Loan Charge survey

Contractors caught by Loan Charge 2019 have until tonight to complete a survey aimed at giving the most up-to-date picture yet of their experience with HMRC.

Whether its settlement terms are reasonable; if it changing the deadlines has caused issues and if it has threatened them, are among the questions about HMRC contractors are asked.

Posted by MPs on the Loan Charge APPG, the survey must be completed by 2300 today (Monday October 28th). Responses can be left confidentially if participants prefer.

All submissions will used by the MPs to inform a new report on the Revenue’s approach to contractors and other affected taxpayers since the charge took effect on April 5th.

'Everyone'

The survey is backed by the Loan Charge Action Group, a loan charge support group which wants to ‘encourage everyone’ affected by the April tax to share and record their experience.

Some of those experiences – and the incoming answers to the survey’s queries about whether HMRC settlements are reasonable  – are known already by a Treasury Sub-Committee.

“There have been delays [from HMRC] in providing settlement terms to those who wished to settle their affairs under the Contractor Loan Settlement Opportunity,” the TSC says.

In addition, the sub-committee has “heard that it is too difficult for anyone involved in a dispute with HMRC…to find adequate information from HMRC to help them understand the law and find out about their rights and the help that is available to them.”

'Partially accepts'

Featured in Recommendation 2 and Recommendation 13, respectively, in a TSC report entitled ‘Disputing Tax,’ both these issues are likely to show up in the APPG survey results.

Yet on Recommendation 2 -- that HMRC should in future monitor its response times in light of the delays, the government says it only “partially accepts” the recommendation.

In the justification for not fully accepting the recommendation, HMRC said that, firstly the CLSO prompted a “big” response, and secondly, “additional resources” were deployed.  

Thirdly though, and in effect refusing the TSC’s monitoring recommendation, HMRC said its systems “do not monitor response times for this settlement activity on an automated basis.”  

'Accessibility, quality and detail'

Nonetheless, the government has fully accepted Recommendation 13 (and nine other of the sub-committee’s recommendations, so partially accepts 3 in total), which relates to access.

In particular, the Revenue will improve the ‘accessibility, quality and detail-level’ of its online guidance -- as the Treasury Sub-Committee says it ought to, by March 2020.

Yet even the recommendations which HMRC says it does accept aren’t really lancing the boil for Loan Charge contractors, indicates Keith Gordon QC.

Taking issue with accepted-Recommendation 4, the tax barrister said ‘closed years’ in a concession HMRC tabled should include those years for which there was no HMRC enquiry.

'Meaningless, but almost dishonest'

Mr Gordon took to Twitter to say he believes it is wrong that the Revenue’s response to the TSC seemed to limit ‘closed years’ to those where an enquiry was opened and closed.

He therefore questions how many people will actually qualify for the concession. “In my meeting with Jesse Norman, a senior HMRC official said that they considered ‘no-one’ to be in this narrow category.

“If that is what they believed,” the barrister added, “and what they now mean, then their concession is not only meaningless but almost dishonest.”

'Clear strategy'

Even so, all that the TSC recommended (and far from HMRC redefining ‘closed years’), is that HMRC discloses how many people will use the concession, and at what financial cost.

The government said it accepted that recommendation, alongside other Loan Charge-related ones like providing figures on the CLSO; and an “explanation” of a ‘vulnerable’ customer.

Also, HMRC said it had also now fully accepted the need to produce a “clear strategy” for dealing with tax advisers and companies that “continue to promote or enable tax avoidance”.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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