HMRC updates guidance on the loan charge

HMRC has updated its guidance pages on what taxpayers affected by the loan charge should do after the 30 September 2020 reporting deadline has passed. HMRC advises taxpayers and employers who missed the deadline to report any outstanding loan balance noting that penalties and interest may now apply.

When taxpayers need to submit a self-assessment tax return for the 2018–19 tax year with full details of their outstanding loans late filing and payment penalties and interest will start from 1 February 2020.

In cases when taxpayers elected to spread their outstanding loan balance over three years they will also be required to submit self-assessment tax returns for 2019–20 and 2020–21 by the normal 31 January filing deadlines. 

Employers who have already reported and paid the loan charge but need to correct a mistake in the 2018–19 or 2019–20 tax years may be able to send a...