2019 Loan Charge, revisited

HMRC’s retrospective 2019 ‘Disguised Remuneration Loan Charge’ continues to make headlines across the web (see below). The widely-criticised tax penalises those who entered into so-called disguised remuneration schemes, some dating back as far as 1999. The Revenue has targeted approximately 50,000 people, many of whom entered into the schemes, which took various forms, on their employers’ advice. In fact, some had no choice but to enrol if they wanted to keep their jobs. It was claimed that the loan charge would target wealthy ‘financial services’ professionals who knowingly avoided paying income tax and national insurance contributions by getting paid via a loan (from an ‘umbrella company’), which was paid to them monthly (like a salary) and never intended to be paid back.

In reality, many of those affected are far from wealthy and, thanks to the Revenue’s devious tactics, now face financial ruin. Obviously, some were/are wealthy and may have been deliberately avoiding tax (not a crime), but many were public sector workers (nurses, cleaners etc.) who didn’t even know they were enrolled in a scheme.

Either way, HMRC knew about the schemes and chose not to criminalise them. Those enrolled submitted their tax returns every year and in most cases HMRC signed them off without raising any concerns. To add insult to injury, many contractors ended up paying ‘interest rates’ to the aforementioned umbrella companies so it was only their employers who benefited financially, not them.

If anyone should be held accountable, it should be the dodgy scheme providers, along with employers who took advantage of trusting employees to avoid paying NICs. Except not even, because HMRC failed to condemn them at the time so can’t go looking for its ‘pound of flesh’ now, two decades later. We’ve already written on this extensively, but wanted to publish another article highlighting the devastating effect this unlawful tax is having on people’s lives (see below).

Real world consequences…


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ben crampin


Ben’s been here pretty much since the get-go and, as such, has been instrumental in growing the business into what it is today.
He’s passionate about, in his words, ‘helping people and businesses that are just constantly being taken advantage of’ by providing affordable advice and support with an eye to ‘levelling the playing field’.
Ben looks forward to the day when automation will, once and for all, fumigate the fear and confusion caused by oppressive bureaucracy and strongly believes that ‘technology holds the solutions to the problems we’re trying to solve’.
Furthermore, he can see that technology will, in time, provide the scalability required to help a theoretically limitless number of SMEs survive and thrive against the odds.
Ben doesn’t think much of government agencies and he doesn’t suffer fools; two points that aren’t always mutually exclusive.