Disguised remuneration charges will apply to certain loans to directors and employees that are still outstanding after 5 April 2019.
The charge affects arrangements involving loans made via Employee Benefit Trusts (EBTs) and similar disguised remuneration schemes.
The new reporting and payment obligations came into force for employers using such schemes on 5 April 2019. Where the employer does not pay the tax and national insurance the liability can be passed to the individual who benefited from the loan.
Where the individual concerned had taxable income in the 2018/19 tax year of less than £50,000 they will be able to repay the liability over 5 years, and spread over 7 years if their 2018/19 taxable income of less than £30,000.