During Prime Minister's questions, prime minister Boris Johnson told MPs that he had 'undertaken to have a thoroughgoing review' of the Disguised Remuneration loan charge. The timing of any review hangs in the balance: it depends on the various outcomes of parliament's activities over the next few months and the PM's plans to call a general election.
Question by Ross Thomson MP (Aberdeen South) (Con):
'I know that, like me, my right hon. Friend has deep concerns about the unfair retrospective loan charge. It is tearing families apart, driving people to despair and reportedly some to suicide. With more than 8.000 people signing my petition saying that we cannot go on like this, can he advise the House on what urgent action his Government will be taking to address this?'
The Prime Minister responded:
'I thank my hon. Friend for his question because this is an issue that my own constituents have raised with me, and I know that many of my hon. Friends have also had this issue raised with them. I am sure that Members on all sides of the House have met people who have taken out loan charges in the expectation that they can reduce their tax exposure. It is a very, very difficult issue and I have undertaken to have a thoroughgoing review of the matter. Of course, I will make sure that my hon. Friend has every opportunity to have further discussions with the Treasury about how to redress the situation and about the gravity of the situation.'
Disguised remuneration loans taken out since 1999 which are not repaid or settled by 5 April 2019 will be subject to a Loan charge on 5 April 2019.
- The ‘loan charge’ applies to all outstanding third party disguised remuneration loans made since 1999 which if they had been made on 5 April 2019 would have fallen within the disguised remuneration rules
- The loan charge will be made up of income tax and NIC in respect of the 2018/19 tax year.
- It will apply to employees and the self-employed who have taken disguised remuneration loans.
Source: Hansard
