aim key cog flag clipboard-pencil podium flare signal lamp pie-chart graph scale2 hammer2 balance traffic-lights road archery wall share2 warning notification-circle circle-minus prohibited book book2 bookmark

Call your nearest office

Or ask us a question

Search our site

What are you looking for?

share

Surely that’s not right you may ask, HMRC does not give money back. Ordinarily they do not, but if you have previously agreed Voluntary Restitution Settlements with HMRC, now is the time to check the terms.

 

The Morse Review

The Morse Report was published in December 2019 and its recommendations have a major impact on the Loan Charge.

All loans that were obtained between 5 April 1999 and 8 December 2010 are now not included in Loan Charge.

Loans obtained between 9 December 2010 and 5 April 2016 could be excluded from Loan Charge depending on circumstances.

Loans still caught within Loan Charge can have their liabilities spread with time to pay arrangements and even the Loan Charge itself can be spread equally over 3 years.

Importantly, Voluntary Restitution Settlements already reached with HMRC will potentially be repaid.

A win for the taxpayer then?  Yes, but… unfortunately, matters have got stuck. Enactment of the 2020 Finance Bill (Budget) is needed to put the Morse inspired legislation in to effect.

 

Voluntary Restitution Settlement

Once enacted, the legislation requires HMRC to establish a scheme to repay or waive payment in respect of a “qualifying agreement”.

The repayment is triggered by an application from the taxpayer (or agent acting on the taxpayer’s behalf) to HMRC on or before 1 October 2021.

A “qualifying agreement” is defined as an agreement with HMRC, which was

  • Made between 16 March 2016 and 10 March 2020 (inclusive), and which
  • Imposes an obligation to pay an amount of income tax that is referable to a qualifying loan.

The amount paid, or due to be paid, under a qualifying agreement is referred to as a “qualifying amount”, which is also defined as:

  • Being referable to a qualifying loan, and
  • Is a sum that HMRC had no power to recover at the time the qualifying agreement was made.

An agreement that fits the definitions is commonly referred to as a Voluntary Restitution Settlement.

 

Potential Money Back

Any taxpayer that has reached a settlement with HMRC in respect of a tax avoidance arrangement should check the terms of the settlement as they may be due money back.  If a refund isn’t on the cards, you may be able to negate an obligation to make future payments in respect of the settlement.

Sometimes the expression Voluntary Restitution will be present in the settlement agreement or possibly communications with HMRC leading up to the agreement.

Another feature that opens up the possibility of money back is the absence of interest and penalties being charged.

Not all settlements will fit the claim parameters but a number will.

 

We have a wealth of experience dealing with matters involving Voluntary Restitution settlements.
Get in touch with Andy or Paul for help and advice.

If you cannot find the information you need on our website, please contact Paul Malin or Andy Maxfield using our contact form or email directly to pmalin@hwca.com or amaxfield@hwca.com

Be the first to comment

Get in touch

Whatever issue or question you have, we’ve got the answer.
If you want to get in
touch then please complete our form.

Birmingham

Sterling House
71 Francis Road
Edgbaston
Birmingham
B16 8SP

Leeds

Sterling House
1 Sheepscar Court
Meanwood Road
Leeds
LS7 2BB

London

New Derwent House
69 – 73 Theobalds Road
London
WC1X 8TA

Our addresses

Birmingham

Sterling House
71 Francis Road
Edgbaston
Birmingham
B16 8SP

Tel: 0121 456 1613

Leeds

Sterling House
1 Sheepscar Court
Meanwood Road
Leeds
LS7 2BB

Tel: 0113 3981100

London

New Derwent House
69 – 73 Theobalds Road
London
WC1X 8TA

Tel: 0207 025 4650