LCAG Legal

The text below was approved by Andrew Thornhill QC.

PLEASE READ EVERY WORD OF THE BELOW VERY CAREFULLY

THIS ADVICE PROCESS ONLY APPLIES TO THOSE WHO DID NOT SUBMIT A 2018/19 TAX RETURN AND HAVE SUBSEQUENTLY BEEN CONTACTED BY HMRC AND ASKED TO COMPLETE ONE AND ARE FOLLOWING THE LCAG FTT LITIGATION PROCESS

IF YOU ARE WITH ANOTHER TAX ADVISER OR ACCOUNTANT THEN PLEASE CONSULT THEM FIRST BEFORE PROCEEDING

If you have questions or need clarification after reading all the way through then please let us know and we will look to update these instructions
These are instructions on how to complete your 2018/19 Self-Assessment Tax Return (SATR) and how to get Tax Advice if you are using the LCAG FTT Litigation Process.
If you complete your Tax Return as outlined and take tax advice, then you should NOT have to pay punitive penalties (up to 100%). However, please note that it remains the case that you will suffer late payment penalties (15%) and interest IF THE CASE EVENTUALLY LOSES WHICH COULD BE SEVERAL YEARS FROM NOW.

If you have questions then please email litigation@hmrcloancharge.info

Tax Advice

You are strongly encouraged to take professional tax advice before completing your tax return.
Not doing so could leave you open to considerable punitive penalties.
If you already have an adviser then you should talk to them before processing.

Tax Advice Service

THIS ADVICE PROCESS NOW ONLY APPLIES TO THOSE WHO HAVE BEEN ASKED TO FILL IN A 2018/19 TAX RETURN BY HMRC AND ARE FOLLOWING THE LCAG FTT LITIGATION PROCESS.
THE TAX PLANNING YOU USED MUST HAVE HAD AN OFFSHORE ELEMENT (INCLUDING CHANNEL ISLANDS AND ISLE OF MAN, BUT NOT GIBRALTAR). IF IT DOES NOT HAVE AN OFFSHORE ELEMENT OR YOU ARE UNSURE THEN YOU SHOULD STATE THAT YOU ARE UNSURE IN THE EMAIL.
We have set up a service for people who want tax advice SPECIFICALLY for and LIMITED to the aspects of your tax return that require that advice.
This service is provide byu Andrew Thornhill QC using Castlemaine Associates Tax Advisers.
They will also not be able to advise you on settlement or other aspects of the Loan Charge.
This service is independent of LCAG. There is a cost of for the advice only of £150 (including VAT).
This does not mean they will complete your tax return for you. You may ask an accountant or similar to do this on your behalf. Castlemaine offer this service for £150 (including VAT).

The process you will need to follow is:

1. You will need to the answer the questions relating to your use of loan arrangements given below. You may either cut and paste these questions into an email, or alternatively you can download the questions via the following link: Tax Advice Questions.
2. Record the answers to each of the questions in either the email or the downloaded document. If you have used several schemes then please provide details for each one.
3. If using the document then attach this to an email when it has been completed.
4. Send the email to Castlemaine Associates using the email address (mailto:kyc@castlemaineassociates.co.uk) with the SUBJECT TITLE "LCAG 2018/19 TAX RETURN QC ADVICE". It is very important that you use these details as it makes the process more efficient by allowing emails to be identified quickly.
   Castlemaine are a service that only verify your identity and pass the documents on to Andrew Thornhill QC, unless you request further services (specifically Tax Return completion) which will be charged separately.
5. Castlemaine will need to be assured of who you are prior to using the service. For this you will need to provide Photo ID and Proof of Address. This information will only be used to confirm your identity and will remain confidential.
6. Where possible a Zoom appointment or similar can be arranged to enable your identity to be verified.
7. Following this appointment you will be asked to email copies of your Photo ID and Proof of Address to Castlemaine (kyc@castlemaineassociates.co.uk) with the TITLE "LCAG 2018/19 TAX RETURN QC ADVICE PROOF". This will be confirmed at your Zoom appointment as well.
8. If you are unable to do this online alternative arrangements will be made for the ID process; however it cannot be avoided.
9. Castlemaine will then forward the tax details to Andrew Thornhill QC.
10. Andrew Thornhill QC will review the tax details and issue the necessary advice back to Castlemaine.
11. You will receive the advice back via email, together with an invoice for £150 including VAT.
12. It is not guaranteed that your circumstances will qualify for using the use of the whitespace given. However, the fee will still be due.
13. You will need to keep the advice safe for possible future reference.

Link To Flow Chart Of Tax Advice Process

For the below questions please give details for each individual scheme

The questions you must answer in the email are as follows:

1. How many contractor schemes have you participated in?
2. In relation to the scheme or schemes were you employed or self-employed or what other capacity did you have?
3. What percentage of the total amount received was through loans?
4. As far as you are aware, was tax paid on your income apart from the loan?
5. Did anyone advise you on the tax treatment of payments to you? What advice did you get?
6. What were the terms of the loans particularly as regards repayment?
7. Do you have any 'open years', that is, years prior to 2017-18 where HMRC are claiming you owe tax?

Completing Your Tax Return

Most people will be completing a paper Tax Return if they are doing it themselves, as they are not usually available online.
The process for completing the form can be found here: Tax Return Instructions
There are various documents to show you how to fill in the form.
When choosing the SA100 ensure you choose the one thats says SA100 Tax Return(2019).
If you are using an accountant or other service to fill in your Tax Return, you will still need to provide them with the whitespace(additional information) text as provided below.
Completing a tax return comes at various prices, depending on its complexity,
Castlemaine Associates can also provide the service for a cost of £150 (including VAT).

In terms of completing the form in respect of loans you may do one of the following:

1. Not disclose your loans and not add any whitespace (you still need tax advice). **Not disclosing in the whitespace will very likely prompt further communications from HMRC asking for the information.
2. Disclose the loans and text provided below in the "white-space" section of the tax return. "whitespace" is the "Any other information" section of the Tax Return on page TR-7.
   You need only disclose loans that occurred after 9 December 2010.

VERY IMPORTANT: IF YOU DISCLOSE YOUR LOANS IN THE LOAN CHARGE SECTION OF THE TAX RETURN THEN THIS WILL EFFECTIVELY BE SAYING THAT YOU ADMIT LIABILITY WHICH YOU DO NOT WANT!

The text you will use on your tax return is:

"I have declared loans above as required, but having consulted a professional adviser, and I believe that no tax is due on the grounds that EU Law overrides the Disguised Remuneration legislation"

For Loans

Example

Loans
2011/12 AML £19,487.00
2012/13 AML £23,467.00
2012/13 Garraway £36,127.00
2015/16 Marrow £34,176.00

I have declared loans above as required, but having consulted a professional adviser, and I believe that no tax is due on the grounds that EU Law overrides the Disguised Remuneration legislation

OR

For ODCA

Example

Overdrawn Capital Account Payments
2011/12 AML £19,487.00
2012/13 AML £23,467.00
2012/13 Garraway £36,127.00
2015/16 Marrow £34,176.00

I have declared Overdrawn Capital Account Payments above as required, but having consulted a professional adviser, and I believe that no tax is due on the grounds that EU Law overrides the Disguised Remuneration legislation

Profit share payments to this Overdrawn Capital Account have been declared on my self assessments with any tax due paid.

OR

Change the text according to the scheme type that you used

Document Links