LITRG is calling on HMRC to consider removing the requirement that those in the loan charge settlement process – who have not settled by 31st January 2020 – should have to file a tax return to report the charge, only to amend it to remove the charge once settlement is reached.
HMRC outlined their expectations in guidance added silently to GOV.UK on the same day as the Government’s letter to Sir Amyas Morse, asking him to postpone the release of his loan charge review findings until after the general election.
LITRG points to the great risk of taxpayers getting their tax returns wrong because of this new requirement, particularly unrepresented taxpayers, and those who have not had to file a tax return before.
It’s been suggested that if HMRC could use their powers to remove the requirement it would save considerable effort all round – including for HMRC and advisers – who will already be under huge pressure around the tax return deadline.
Victoria Todd, Head of the LITRG Team, commented, “The delay in publishing the review findings, although inevitable given the general election, is causing additional uncertainty for those in the loan charge settlement process.
“We recognise that the delay to the loan charge review is not the fault of HMRC – but neither is it the fault of those already in the settlement process.
“We call on HMRC to consider whether they can use their discretionary powers to remove this requirement to file a tax return for those in the process of settling the loan charge; this is the right thing to do, for fairness, for simplicity and for the proper administration of taxes.”
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