The loan charge : Mel Stride interview

Money Box

BBC

Business

4.2 • 825 Ratings

🗓️ 2 March 2019

⏱️ 26 minutes

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Summary

Financial Secretary to the Treasury Mel Stride speaks to Paul Lewis about the forthcoming loan charge. The measure, which comes into force in April, aims to stop disguised remuneration schemes which can be used for tax avoidance purposes.

People who have been tricked into authorising payments to bank accounts run by fraudsters stand a much better chance of being reimbursed in future. A new code has been published by the Payment Systems Regulator and agreed by the industry. It includes measures to do more to protect bank and buidling society customers from criminals including reimbursing them in all but exceptional circumstances. The code, which is voluntary, comes into effect on May 28th. Guest: Hannah Nixon, Managing Director, Payment Systems Regulator.

Money Box listener David Hardie runs a small printing business. He recently received a letter from HMRC informing him that from next month he must submit his VAT return digitally. It's part of the wider government Making Tax Digital (MTD) initiative to shift people away from paper-based record keeping. The software used has to be MTD compatible so David is now paying for a new accounts program. Tim Woodgates, a tax adviser and chartered accountant with Moore Stephens, suggests ways in which small businesses can be MTD compliant while keeping costs down.

We hear a cautionary tale of what can happen when the terms and conditions of a guarantor loan are not scrutinised by the friend or relative being asked to pay off the debt if the original borrower defaults. Followed by Sara Williams, founder of the Debt Camel blog and Nick Beal Chief Regulatory and Public Affairs Officer at Amigo Loans in a wider discussion on guarantor loans.

Presenter: Paul Lewis Producer: Charmaine Cozier Editor: Richard Vadon

Transcript

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0:00.0	In Northern Ireland, from the late 70s to the early 90s, the IRA killed over 40 alleged informers.
0:08.0	But the man who often found, tortured and sometimes killed these people on behalf of the IRA
0:12.0	was himself an informer, a secret British army agent with the codename Stakeknife.
0:18.0	Who gets to play God? And why me? Why my family?
0:21.3	When lies are still being told to this day, who do you believe?
0:25.1	I wouldn't even know where to start.
0:26.7	And I'm with the IRA.
0:28.5	Steakknife.
0:29.7	Listen first on BBC Sounds.
0:33.5	BBC Sounds, music, radio, podcasts.
0:37.2	Hello, in Moneybox today. The minister in charge of taxes here to justify tough action against 50,000 people who he says avoided tax on their pay right back to 1999.
0:48.9	New rules could make the banks reimburse their customers when they've been tricked into sending money to thieves,
0:59.9	making tax digital. How costly will new rules be for small businesses and sole traders?
1:05.5	And we hear from one listener who now owes £12,000 to repay a loan, she never borrowed.
1:10.0	But first, the government's under growing pressure this week to look again at how it's pursuing 50,000 people for tens, if not hundreds of thousands of pounds of tax each, on money they earned 10 years ago or longer in some cases.
1:18.6	In the past, these people were not paid wages for the work they did, but at least partly in loans.
1:23.9	The firms that organised these schemes said no income tax was due on that part of their
1:28.9	remuneration as it was a loan not pay. But the government passed a law which enables it to
1:34.4	recover the tax in one year which it says should have been paid on these earnings right back to
1:39.1	1999. It's called the loan charge. To avoid it, people have to agree to pay back the money anyway.
1:45.8	But two senior MPs in charge of two separate parliamentary committees have called on the
1:50.3	government this week to sink again. Last week, we heard from Moneybox listener Andy Taylor,
	...

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