Our previous article set out the announcements in Autumn Budget 2025 on a new settlement opportunity for those taxpayers who were impacted by the Loan Charge enacted in 2017. The announcements recognised that many taxpayers faced hardship from a retrospective tax charge and sought to offer an opportunity to those impacted. This settlement opportunity offers hope to those looking to bring a conclusion to a long running outstanding HMRC matter.
Loan Charge background
Draft legislation and policy paper
The Government has since provided additional details. Draft legislation was published in the Finance Bill (which is awaiting completion of its passage through Parliament to enactment), and HMRC have recently released additional guidance in a technical note published on 9 February 2026.
This additional information confirms that the new settlement opportunity will indeed have favourable terms for resolving historical issues with HMRC. These include recalculating liabilities to tax amounts in the years that they were deemed to have been received, deductions for an element of historic promoter fees which may have been paid (capped at £10,000 a year), and a further deduction of £5,000 from the liability.
These measures could provide a maximum reduction to the amount of tax due of up to £70,000 per impacted person and, in some cases, this will remove the liabilities altogether. Further benefits include the removal of late payment interest and potential penalties, as well as provisions for writing off certain Inheritance Tax liabilities. Flexible payment arrangements of up to five years or more are available if taxpayers are unable to pay immediately.
Overall, this new settlement opportunity offers financial benefits alongside the chance to finally resolve longstanding HMRC matters.
HMRC approach to impacted taxpayers
HMRC have been reviewing individual’s arrangements and have started contacting taxpayers directly with an explanation as to how their position is affected by the outcome of this review. HMRC have confirmed that if a taxpayer’s arrangements are impacted by the review, they should receive an invitation to settle using this new opportunity at a later date.
If you are not contacted by HMRC but anticipate that you are eligible, then there is opportunity to contact HMRC proactively with details of your arrangements. It is recommended that taxpayers provide supporting information, such as the names of the disguised remuneration arrangements used which will help HMRC check eligibility.
As with other HMRC settlement opportunities, it is important that the framework for the settlement opportunity is carefully followed, and professional advice is recommended to ensure that the matter is resolved correctly.
How KPMG can help
Please contact the authors, or your usual KPMG contact in the UK, to talk through how HMRC’s new settlement opportunity might affect you or your business. Our multidisciplinary team of personal, employment and company tax experts can support you with all aspects of tax governance, compliance and remediation.