Jurisdiction(s):
United Kingdom

Finance Bill 2026 (UK): Loan Charge Review—Government Response and HMRC Settlement Powers (Clauses 25-27), including Write-offs, Unstacking, Extended Payment Plans and Timetable

Published on: 11 December 2025

Published by a LexisNexis Tax expert

Legal News

Article summary

Why was an independent review of the loan charge commissioned, and what were the objectives of the review?

For nearly ten years, the Loan Charge has stirred continuing dispute. An independent review in 2019 delivered some middle ground between HMRC and affected taxpayers, yet many have still been unable to finalise their positions with HMRC. A further independent review, announced at Autumn Budget 2024, was designed to break this deadlock, enabling this group to reach settlements with HMRC while safeguarding fairness for all taxpayers and preserving HMRC’s ability to collect tax that is properly due. Its purpose was to unlock resolution for those still stuck, without diluting equity across the system or weakening HMRC’s collection remit.

What were the recommendations made by the Final Report?

The Final Report maintains that, although taxpayers must take responsibility for their own tax affairs, the Loan Charge was an exceptional legislative measure and susceptible to the charge that HMRC deployed it as a blunt instrument. In his foreword, Mr McCann observed that the Loan Charge is unfair and that HMRC’s settlement terms failed to reflect the ability of those involved to pay and were far from generous...

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