Contractors whose employers paid them through loans from offshore trusts are being urged to speak to us before 5 April 2019 or risk receiving massive tax bills.

Up to 50,000 self-employed workers in the UK are believed to have benefitted from the lower income tax rates applied under loan advances, instead of being paid salaries.

Those yet to have settled outstanding loans dating back to when the schemes first arose in 1999 could be facing a hefty tax bill.

From 5 April 2019, HMRC will begin to apply a tax charge on outstanding balances on any such loans made since 6 April 1999.

HMRC has confirmed that payment arrangements are available for those who would struggle to pay back what's owed.

Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants (ACCA), said:

"Anybody who used a loan scheme, or even thinks they may have been enrolled on one, should seek advice from a chartered certified accountant.

"It is important to check if you are still enrolled, as HMRC will only offer you help if you are no longer using loan schemes."

Speak to us urgently if this affects you.

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