On 7 November 2017, HMRC published guidance entitled: “Disguised remuneration: settling your tax affairs”. The guidance sets out new settlement terms in relation to disguised remuneration arrangements. Liabilities can be settled by employers, employees or self-employed contractors.
The settlement opportunity relates to employment taxes (income and NICs) as well as capital gains tax, inheritance tax and corporation tax. Late payment interest applies and penalties may also be imposed, depending on the circumstances.
Although the settlement opportunity is open-ended, those considering settlement should be mindful that if liabilities in relation to loans are not settled before 5 April 2019, they will be subject to the loan charge arising on loans outstanding on that date. Once a 2019 loan charge has arisen, HMRC’s guidance notes that the settlement opportunity may not be available.
The guidance can be viewed here.