The deadline for reporting details of outstanding disguised remuneration loans to HMRC is 1 October 2019. The online tool for making these reports is now available; a government gateway account is required plus full details of all loans.
The loan charge was introduced by Finance (No. 2) Act 2017 in respect of all outstanding Disguised Remuneration loans taken out since 1999 and took effect on 5 April 2019. It applies to individuals with loans under employment related schemes such as EBTs and EFRBs as well as contractor loans.
Under the new rules all employees and self-employed contractors with outstanding loans must provide details of their loans to HMRC by 1 October 2019 or severe penalties could result. Details must be provided of:
- the scheme name(s)
- the start and end dates of all schemes used
- any HMRC case reference numbers
- the Disclosure of Tax Avoidance Scheme (DOTAS) number, if there is one
- the total loan amount in each tax year, by scheme, including any amounts repaid or written off.
- any amounts of tax or National Insurance contributions already settled but excluding any APN’s paid
Penalties for late reporting start at £300 with penalties for inaccuracies of up to £3,000 per inaccuracy.
Individuals who do not have a government gateway account will need to register for one or ask their tax agent to input their details for them. Given this and the level of information that some scheme users will need to provide it is recommended that action is taken now to ensure that the deadline is met, especially if documents have been misplaced and details need to be requested from the original scheme providers.
Anyone who had already settled with HMRC by 5 April 2019 does not need to report any loans included in the settlement even if they remain outstanding.
Links to our guides:
Disguised remuneration loan charge (subscriber guide)
FAQs for Disguised Remuneration Settlements
Accelerated Payments & Follower Notices
External links:
HMRC: Report and account for your disguised remuneration loan charge