HMRC clamping down on enablers of tax avoidance schemes

25 Oct 2019

HMRC says it is clamping down on the promoters and enablers of tax avoidance schemes in the wake of the loan charge controversy.

Penny Ciniewicz, Director General of Customer Compliance at HMRC, told a Treasury Select Committee session that the tax authority is 'doubling the resources' to tackle those in the 'avoidance supply chain'.

In response to questions about the loan charge, Ms Ciniewicz said: 'We have more than 100 current investigations into promoters [and enablers], and we're keeping a very close eye on the market for avoidance. We are spotting schemes as they emerge and we're tackling them.'

The loan charge policy is currently subject to an independent review following months of pressure from MPs, taxpayers and campaigners. It came into effect on 6 April this year, and applies to anyone who used 'disguised remuneration' schemes. The legislation added a 45% non-refundable charge on all loans advanced through the schemes, unless the individual had agreed with HMRC to settle their tax affairs by 5 April.

The charge mainly affects freelancers and agency workers: however, many of the 50,000 people caught up in the issue are low paid and were persuaded by their employers to join the schemes. The typical sum owing, according to the Loan Charge Action Group (LCAG), is almost £120,000.

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