Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment she has made of the adequacy of the proposed loan charge settlement scheme cut off date of 1 June 2021 for excluding taxpayers who have entered into contract settlements with HMRC before that date; and what steps she has taken to help ensure that taxpayers who settled earlier are not disadvantaged compared with those who settle under the new scheme.

The Government commissioned an independent review of the loan charge to bring the matter to a close for those affected, ensure fairness for all taxpayers and ensure that appropriate support is in place for those subject to the loan charge.

The purpose of the review was to bring the matter to a close for people who have not settled and paid their loan charge liabilities. Although the loan charge officially came into force from 6 April 2019, the deadline for settling to avoid being liable to the loan charge was extended because of the Morse Review. The settlement opportunity applies after 1 June 2021 because it is from that date onwards that loan charge settlements were agreed.

The review identified affordability as a key barrier preventing those individuals from settling and made recommendations to remove this barrier. The Government accepted all but one of the review’s recommendations and will legislate to give HMRC the power to administer a new settlement scheme.

The Government has no plans to apply the recommendations of the review beyond those individuals and employers with outstanding liabilities that were the focus of the review.