Knowledge

HMRC deadline to register disguised remuneration schemes

Posted on Jul 10th, 2018 | Tax

HMRC deadline to register disguised remuneration schemes, image of HMRC logo on a brick wall

Disguised remuneration schemes claim to avoid the need to pay Income Tax and National Insurance Contributions. They normally involve a loan or other payment from a third-party which is unlikely to ever be repaid. The use of an Employee Benefit Trust (EBT) is an example of a disguised remuneration scheme.

These schemes are used by employers and individuals alike. If they’re used by contractors, they’re often known as ‘contractor loans’.

If you’re in a disguised remuneration scheme, you need to contact HMRC as soon as possible. If you don’t, a new loan charge announced in the 2016 Budget will apply to all disguised remuneration loans outstanding on 5 April 2019. The loan charge means the directors/shareholders becoming liable to pay Income Tax and National Insurance Contributions on any loans made to them individually through a disguised remuneration scheme.

How to settle your tax affairs

To start settling any tax affairs arising from a disguised remuneration scheme, you should register your details with HMRC and provide the required information by 30th September 2018. HMRC have a webpage giving an overview of your responsibilities and a full list of the information you need to provide to settle your tax affairs.

Register your interest

If you’re already speaking to someone in HMRC about you or your company’s use of a disguised remuneration scheme, or if you have a customer compliance manager, you can register your details with them. If you’re not already speaking to someone at HMRC, register your interest by emailing:

cl.resolution@hmrc.gsi.gov.uk for contractor loan schemes
ca.admin@hmrc.gsi.gov.uk for all other disguised remuneration schemes.

Crunch does not provide any advice or support regarding disguised remuneration schemes. If HMRC contacts you about a scheme you should seek advice from your financial advisor. You may require specialist legal advice to respond to any questions from HMRC.

Join Crunch Chorus:
The free community for the self-employed

You'll get access to a range of benefits, such as invoice software, jargon-free business guides, great networking opportunities, discounts, plus much more

Written by Jake Smith

Useful tools and resources

Business guides

From understanding expenses to starting a limited company, we've a range of jargon-free business guides for you to download and keep.

Invoicing software and templates

Create, send and store sole trader invoices in a snap with our free invoice software. You can also download a selection of invoice templates for all business types.

Take-home pay calculator

Use our Take-Home Pay Calculator to work out your true earnings and see if you could save money with a different company set up.