On 1 and 4 February 2019, HMRC published amendments to its guidance on settling disguised remuneration loan tax liabilities before the April 2019 loan charge arises. The amendments include an extension to the time period over which taxpayers can pay what they owe.
HMRC originally launched the settlement opportunity in 2017 and announced in 2018 that taxpayers could pay what they owe over a period of up to five years, provided their earnings are less than £50,000 and they are no longer participating in tax avoidance arrangements.
The updated guidance now states that:
- there is no need to provide detailed financial information for a payment arrangement of up to seven years, if the taxpayer's income for the current year is less than £30,000
- there is no need to provide detailed financial information for a payment arrangement of up to five years for taxpayers earning less than £50,000
- there is no maximum time period for payment arrangements, so if a taxpayer earns £50,000 or more, or needs a longer time to pay, they should contact HMRC. Taxpayers must provide detailed financial information in these circumstances.
The updated guidance also states that although the deadlines for registering an interest in the settlement opportunity and providing HMRC with information have passed, taxpayers wishing to settle before the loan charge takes effect should contact HMRC as soon as possible before 5 April 2019.