The Daily Mail on 21st August carried a report saying that more than 50,000 contract workers — including nurses, teachers, and small business owners — have been hit with backdated tax demands (under the so-called “Loan Charge” clawback arrangements introduced by HMRC) for as much as hundreds of thousands of pounds.  These involved paying workers using tax-free loans from offshore trusts that did not need to be paid back.  By paying the workers a loan, it meant employers did not need to pay income tax and National Insurance contributions.  Since April, any such “loans” became taxable, meaning that freelancers who used the legal loophole face a retrospective tax bill on all their income since 1999 that was paid using the loans.  One example cited involves a man who used an “umbrella” company — based on the Isle of Man — which took around 15% of his income in fees and he missed out on pension contributions, holiday and sick pay that employees normally get.  A tax barrister is quoted as saying that many workers had to sign up to the scheme in order to get paid, and were given no indication they were doing wrong.

This blog is primarily for my own use, to keep informed and up to date. However, if you would like to say thank you (and perhaps help me get a new, better laptop when I am away…) you can “buy me a coffee” at


Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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