The 2019 Loan Charge which was introduced by the Finance (No. 2) Act 2017. The 2019 Loan Charge is effectively a back tax, and HMRC have demanded that all those affected must pay the charge in the 2019-2020 tax year despite these loans, being perfectly legal, were promoted by financial advisors, accountants and other financial specialists. The reality is that if the policy continues unamended, there will be many bankruptcies, at a significant cost to the taxpayer. Some individuals affected will be unable to work again, following a bankruptcy, and quite a number that we are aware of are already retired. The human impact, which is becoming increasingly apparent, will be serious. There is significant concern about the Loan Charge, its fairness and its impact on those affected. With such people now being pursued for tax in respect of these closed years, it is not only undeniably retrospective but also simply wrong. It undermines the basic principle of tax certainty that underpins the UK tax system.
“We the undersigned call on the UK Government to suspend the 2019 Loan Charge before the end of September and to order a proper review of the policy which is independent of HMRC and the Government.
We urge the Government to put all settlement activity on hold and that all settlement agreements, including agreed payment plans, be suspended until the independent review is completed and Parliament has considered its conclusions.
We further call on the Government to bring forward legislation to remove the retrospective element of the 2019 Loan Charge completely so that it applies from the date of Royal Assent of the Finance Act, 16th November 2017."