Loan charge – additional information form FAQs
Although an independent review of the loan charge is currently underway, you may still need to complete an ‘additional information’ form for HMRC by 11.59pm on 30 September 2019 (i.e. before 1 October 2019). We know that completing the additional information reporting form may be causing some concern or difficulty – here we offer some help and guidance in the form of some FAQs.
In conjunction with reading these FAQs, we recommend that you familiarise yourself with the general rules around reporting and paying the loan charge, as set out in our earlier news piece, The loan charge – here’s how to deal with it.
If you want to understand more about the independent review and what this might mean for you, see our news piece, Loan charge review – have your say.
Who needs to complete the form?
It is probably easier to think about who does not need to complete the form.
You do not need to complete the form if:
- You have already agreed a settlement with HMRC and have paid the agreed amount in full or are paying it in instalments; or
- You provided all the required information to HMRC by 5 April 2019 and are waiting to finalise your settlement with HMRC.
Everyone else affected by the loan charge (even those where PAYE has now been operated by their employer) will need to complete the form. If you have ‘repaid’ some or all of your loan, please be aware that the repayment may be disregarded, so you may still need to report your loan amount as outstanding even if you think the loan has been repaid.
What is the point of the form?
Completing this form allows HMRC to check the details provided against any information they already hold about your loan activity.
If there is any significant mismatch, then HMRC should contact you. This should help ensure that the tax return you need to submit to HMRC for 2018/19, ultimately, contains accurate and complete information.
Why do I need to complete the form if there is a review of the loan charge going on?
The information reporting requirement is enshrined in law – for those with a technical interest in the law – it is in Finance No 2 Act 2017 Sch 11 Pt 3A.
At least, while the review is being undertaken, the law, as it stands, remains in place
How can I complete the additional information form?
You have two options:
- Complete the online form (you will need a Government Gateway username and password to do this – if you don’t have any, you can create sign in details there and then…)
- Phone HMRC on 03000 599 110 and request a paper version of the form. If you choose this option, you do not have much time. It is conceivable that HMRC may accept a slightly late (but otherwise completed form), although we can offer no guarantees!
If you really cannot use either of the options above then you should phone HMRC on 03000 599 110 straight away to discuss your options.
What information do I have to give?
You will need to provide:
- Your personal details (name, address, telephone number, email address, National Insurance number)
- Details of the arrangements, including:
- the scheme name (if you do not know the exact name you should use a name that helps to identify it – e.g. ‘Umbrella company XX loan scheme’)
- the start and end dates of the schemes you used (estimated, if necessary)
- a HMRC case reference number, if you have one
- the Disclosure of Tax Avoidance Scheme number, if you have one
- the total loan amount in each tax year, including any amounts repaid or written off (if you are a lower paid agency worker who inadvertently got caught up in an umbrella company loan scheme, there are unlikely to be any amounts repaid or written off)
- any amounts of tax or National Insurance contributions that have already been settled (again, there are unlikely to be any amounts of tax/NIC already settled)
- Employer details (name, PAYE reference – this looks something like 123/AB4565 and you may be able to find it on your payslips or P60/P45 – if not, you can type ‘Unknown’).
In the context of lower paid agency workers, the ‘employer’ will probably be the umbrella company you worked through at the time you were receiving loans, rather than the agency that found you the work or the end client that you worked for.
What if I can’t provide all of the information?
Then you should provide as much as you can. Note that the online form does allow you to type ‘Unknown’ and some of the questions have a ‘Do not know’ option.
What if I don’t complete the form?
If you do not do complete the form, or the information is not correct and complete as far as possible, you may be liable to penalties. Our understanding is that penalties will only be charged in the most serious cases but, strictly, anyone who does not report the loans by 30 September could be liable.
What if I need help completing the form?
We have tested the form and it is likely to be quick and straightforward to complete if you have details of your loans. However, if you need some help in completing the form, you should ask HMRC or if you are on a low income, contact TaxAid.
Josie Jones worked as a nursing aid in a hospital through ‘Best nurses’ agency’ between April 2015 and September 2015. Best nurses agency passed her over to ‘Best umbrella company’ to be paid. Best umbrella company used a loan arrangement to pay Josie.
Josie doesn’t really have any paperwork from that time but has managed to get her bank statements for the period April 2015 to September 2015 and can see that she received one element of pay as a ‘minimum wage’ salary each month (so around £1,100) and one element of pay as untaxed loans of roughly £260 each month for 6 months (£1,560 in total).
Under the loan charge, Josie will have to now pay tax on the £1,560 amount. Josie’s additional information from will look something like this:
Filling in form for self
National insurance number
6 Road Close
Telephone number: 07777888888
Email address: jj [at] email.com
Scheme: Best umbrella
Dates when you received loans
6 April 2015 to 30 September 2015
Disclosure of Tax Avoidance Schemes (DOTAS) number
Do not know
HMRC case reference number
Tax or National Insurance paid or agreed to pay
Do not know
Loan details for Best umbrella
2015 to 2016
Is the total loan amount paid from 6 April 2015 to 5 April 2016 an estimate?