Settlement of Disguised Renumeration and Umbrella Payroll Schemes

If you have used a disguised remuneration scheme and have loans outstanding on 5 April, 2019, then income tax and NIC will apply under the 2019 loan charge.  This treats the outstanding amounts as taxable income for the tax year 2018/19 and imposes reporting and payment obligations on both employers and employees.

You must therefore ensure that the loan charge is settled in accordance with the legal requirements or face penalties.  HMRC have published detailed reporting and payment guidance here and there is also a settlement opportunity and settlement guidance.

If you have used an umbrella payroll scheme and paid broadly less than 20% tax on the sums received, then you are at high risk of crossing the line from tax avoidance into tax evasion.

Frequently Asked Questions

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