Exiting Remuneration Trusts raise a number of issues that need to be addressed. Finding a tax solution (particularly one that is acceptable!) may have become easier for some with HMRC’s new Settlement Terms recently announced. Applications to HMRC have to be with HMRC by 31 July 2022, with all computations. Even then there may still be other issues to be addressed.
There is no doubt that tax avoidance evolved over the years. I first came across tax schemes in the 1990’s when there were more “simple” schemes such as investments in platinum sponge and alike. Then they progressed to Employee Benefit Trusts and Remuneration Trusts through which owners of businesses were given interest free loans. Certain scheme providers became even more inventive and made similar advances to “suppliers” through entities based in the Caribbean.
January is a funny month. The festive celebrations have been and gone. A lot of taxpayers turn to filing their Self Assessment Tax Return by the end of the month. Others are simply looking backwards and forwards and thinking how are they going to fair in 2022. So why is now possibly a good time to push for a Settlement if you are under a tax investigation?
The light at the end of the tunnelContinue reading “Is now the time to push for a Settlement?”
For many taxpayers, a brown envelope from HMRC will not be well received at any time of the year. Odds on it will contain bad news. It may be the start of an investigation. It may be a “nudge letter” or a “Check on tax position“. It almost certainly won’t be a Christmas card!
Is it deliberate or just a question of bad timing?
HMRC are writing to taxpayers that have outstanding loans from their EBTs, EFRBs and other offshore structures. HMRC use information received under the Common Reporting Standard to identify those ignoring the Loan Charge. The origins of some of these arrangements go back to the 1990’s and have been “forgotten” – that is until now.
Surely HMRC know about all loans?
HMRC are pretty good at grabbing people’s attention by using such headings in their letters to taxpayers. Such letters are often effective because their “intelligence sources” are pretty accurate. I have seen letters in the past where HMRC have even quoted bank account numbers from the outset just to demonstrate how much detail they had at the time. All targeting offshore income and gains.
And then along came the Common Reporting Standard (CRS).