A cross-party group of MPs are calling on HMRC to delay the introduction of the so-called loan charge which comes into force in one month’s time. The charge will hit about 50,000 self-employed contractors who used arrangements that involved being paid via loans from an offshore trust that were theoretically tax-free. Some schemes date back 20 years but HMRC say they were never legal. In a letter to the Chancellor, the MPs say the policy is “undeniably retrospective” and “undermines the basic principle of tax certainty that underpins the UK tax system”. The MPs have also reported HMRC to the Financial Conduct Authority for writing to the contractors suggesting they go into debt to pay their loan charges. They say HMRC may have breached FCA regulations as it is not approved to offer debt advice.
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