tax avoidance

Tax Avoidance Crackdown Review Scheduled After Complaints

Posted 22nd January 2019 in News For Businesses

The Treasury has committed to a review of the 2019 Loan Charge after complaints by campaigners.

 

The 2019 Loan Charge, set to come into force in April seeks to recoup tax losses from disguised remuneration schemes to avoid tax. Such schemes, which were understood by many to be legal at the time, were used by contractors and third-party workers – but have been described by Treasury Minister Mel Stride as “aggressive tax avoidance”.

 

Campaigners argue that the loan charge targets contractors, putting some at risk of bankruptcy.

 

Liberal Democrat MP Ed Davey has suggested an amendment to the Finance Bill, which would require the Treasury to review the policy before March 30.

 

“It is the sort of taxation that led the barons to rebel against King John and gave birth to Magna Carta,” said Davey, speaking at the House of Commons. “It is simply not acceptable for a Government to introduce a law that makes illegal something someone did years ago, when that action was considered legal.”

 

Stride accepted Davey’s proposal, adding, “It is absolutely right that, when HMRC deals with the public, it has a strict duty of care, a duty of proportionality and a duty to be as sympathetic as it can be relevant to the circumstances of those with whom it is dealing.”

 

A spokesperson for the Government confirmed that the loan charge will still come into effect on April 5, stating, “We want to do all we can to make it simple for people to get out of these schemes and we’re here to help. Anybody who is worried about being able to pay what they owe to get in touch with HMRC as soon as possible on 03000 534 226.”

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