Find out about the loan charge settlement scheme

Who is eligible for the settlement scheme

This scheme applies to you if you’re an individual or an employer and you have a disguised remuneration loan charge liability that you have not paid in full. This includes anyIncome Tax, National Insurance contributions and late payment interest that arose:

• because of the loan charge liability— coverednormally byin the tax year ending 5 April 2019
• when the loan charge income, normally in the form of loans, was received in earlier tax years (6 April to 5 April)
• because of the loan charge and was included in a settlement you agreed to after 1 June 2021.
  2021

HMRC will write to the people we believe are eligible, with an offer to settle their outstanding loan charge liability under this scheme.

Your letter will show the:

• loan details and any other income we’ve used to calculate your settlement offer
• amount due if you choose to settle

What the settlement scheme includes

Subject to a maximum £70,000 reduction, the settlement offer:

• uses a simplified calculation to work out an amount that represents the tax and National Insurance due on your disguisedloan remuneration,charge income, in the tax year (6 April to 5 April) you received themthat income — this may reduce the amount due
• includes a reduction for promoter fees
• deducts a further £5,000 from your liability
• will not include the late payment interestinterest, Inheritance Tax liabilities and most penalties applied to your original loan charge amount

If an employer should have deducted PAYE

If payments were made by an employer who was responsible for deducting PAYE from an employee’s loan charge income, we’ll:

• try to settle the loan charge liability with the employer first — if they still exist
• write to the employee at the same time as the employer with an offer

If we cannot settle the liability with the employer, we’ll write again to the employee and may need to send them a new offer.

The employee can accept their settlement offer straight away if either:

• the amount they need to pay is £0
• they want to settle now and do not want to wait while we try to settle the loan charge with the employer

If the employee decides to wait until we’ve tried to settle the liability with the employer, they will not lose their chance to settle.

For more information and examples you can read how HMRC will implement the loan charge settlement scheme.

Inheritance Tax loan charge liabilities

TheSome unpaiddisguised loanremuneration chargearrangements use a trust, which may lead to Inheritance Tax liabilitiescharges. thatFor willexample, becharges may arise:

• every 10 years after money is put into the trust
• when a loan is written off
• when asthe trust ends

As part of the settlement arescheme, thoseunpaid Inheritance Tax liabilities that are:will no longer be payable are those that:

• relate to loan charge arrangements being settled under the scheme
• have already duearisen
• duearise within 903 daysmonths of the date on your settlement offer letter

If we send you a new settlement offer, the Inheritance Tax loanliabilities chargethat will no longer be payable are those that arise within 3 months of the date on the new offer letter.    

Inheritance Tax liabilities that occurarise after this period will notneed to be writtenpaid off.when they arise. You can contact your caseworker if you need more information about this.

You may want to get independent advice, for example from a tax adviser, to:

• check if you could still be liable for Inheritance Tax even if you settle
• decide if you need to end any loan or trust arrangements as part of the settlement, to prevent future Inheritance Tax liabilities arising

What support we can give

We want to provide the right support for you through this process. You can contact us before:

• you receive the offer letter
• deciding whether to accept the offer

We can:

• check if you’re eligible for this scheme
• discuss any questions about your specific circumstances
• explain the different payment options

You may also want to get independent professional advice. You may be able to get free advice from organisations such as TaxAid (if you’re on a low income) or Citizens Advice.

Before accepting the settlement offer

Before deciding to settle under this scheme, check if you:

• agree with the figures in the letter
• can pay the full amount as one payment

If you do not agree with the figures

Contact your caseworker if you do not agree with the figures in the letter. They’ll:

• discuss the figures with you
• send a new settlement offer if any of the figures change

If you cannot pay the full amount as one payment

Contact your caseworker if you cannot pay the full amount as one payment before you accept your settlement offer. They’ll work with you to agree a payment plan based on your financial situation. You can pay by instalments for up to 5 years under the new terms. Depending on your circumstances, you may be able to pay over a longer period.

You’ll pay interest when paying by instalments. Your caseworker will explain this to you and send a new settlement offer that includes the interest for your payment plan.

If you accept the settlement offer

If you’re considering settling your case under this scheme, you should contact us as soon as possible after receiving your offer.

If you accept the offer, it:

• becomes a legally binding contract between you and HMRC, even if you have nothing to pay
• will end any compliance checks we still have open into your disguised remuneration arrangements covered in the offer letter

To accept thisyour offer you must fill in, sign and return the acceptance form to us. This is included in the letter we sent with your settlement calculation. You can return this either:

• by post
• by scanning it and sending it by email to us

We’ll send you the details you need to make your payment, when we receive your completed form, if you have an amount to pay.

If you have other outstanding disguised remuneration liabilities

If you have other disguised remuneration liabilities, your offer will include them if both of the following conditions apply:

• they are not covered by the loan charge settlement scheme
• they were subject to an enquiry opened, or included in assessment issued, by HMRC on or before 26 November 2025 (the date the government published its response to the review)

If you do not accept the settlement offer

If you do not accept the settlement offer:

• you’ll need to pay the full loan charge liability
• we’ll contact you about resolving your outstanding disguised remuneration liabilities under our normal processes
• the amount you’ll have to pay will depend on how and when your liability is finalised
• you may need to pay other charges — for example, late payment interest that will be applied until you have paid in full

How to contact us

You can contact your caseworker using their details in your letter. If you do not have a caseworker, you can contact us by:

• telephone: 0300 322 9494
• email: CAGetHelpOutOfTaxAvoidance@hmrc.gov.uk

To email us, you must tell us in writing (by email or post) that you understand and accept the risks of using email — read Corresponding with HMRC by email.

You can also write to us using the following address: