Loan Charge Debate

I attended the brief debate on the taxation of loans in the House on 8th January. I intervened in the debate to make the points that people had often taken professional advice about the legality of these schemes, and had notified the tax authorities of what they were doing.

Other speakers in the debate set out individual cases that demonstrated the Revenue was seeking to go back a long way and to impose very large retrospective charges on people when they had not tried to charge them extra tax at the time.

Given the number of MPs including myself who would have voted for the amendment to the Finance Bill calling for a review, the Government conceded and accepted the amendment. This is welcome and gives us another opportunity to put the case to the Revenue. The Treasury Minister accepting the Amendment did not however accept the underlying point at issue, and reaffirmed the Treasury view that some of these schemes were always illegal and that tax remains due. I recommend that support groups re-submit the case to the Treasury as part of the review they must now undertake.

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2 Comments

  1. Narrow Shoulders
    Posted January 10, 2019 at 1:02 pm | Permalink

    If the revenue were informed at the time that an individual was participating in a known scheme and took no action it should now have no recourse.

    What next PAYE changes and claw backs?

    • Lifelogic
      Posted January 12, 2019 at 2:07 pm | Permalink

      Well the Treasury are always moving the goal posts. Look at all the reduction in the private pension pot caps and pension contribution limits. Arranged very unfairly so that state sector pensions (mainly defined benefit pots and indeed MP’s ones) are less likely to be hit than most private sector defined contribution ones.

      How can you make sensible investment decisions for a long term plan like a pension if they move the goal post every year. Plus it increases all the cost of running the pensions and the advice needed! Major, Brown, Darling, Osborne and Hammond were all appalling chancellors. But they will all get very good pensions indeed.

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    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

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