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HMRC extends Contractor Loan Settlement Opportunity to June

In its infinite wisdom, Her Majesty’s Revenue & Customs has decided to extend its Contractor Loan Settlement Opportunity to 30 June of next year.

CLSO, which was set up by the taxman in order to help approximately 16,000 Brits suspected of using offshore schemes for tax avoidance a window of opportunity to come clean and pay what they owed before having to become liable for tax penalties and charges, was set to shutter on 9 January of 2015. Many users of this offshore scheme were understood to have been IT contractors – hence the name of the programme – and whilst most people are used to HMRC being rather heavy-handed and intractable when it comes to its deadlines, the sudden six month extension is likely to be a very pleasant surprise for anyone who hasn’t gotten around to paying off their tax debts quite yet.

The tax authority, for its part, says that there are “exceptional reasons” behind the extension, remarking that there will be no other ones like it in the future. Nothing else has changed, HMRC says – anyone subject to the programme is still liable for every last penny, and with the taxman stating that the average amount owed is around £11,000 or so, the extra time to scrape up the funds and send them off to the Treasury is likely to be greeted with relief and thanks by anyone who ended up in hot water for tax avoidance to begin with.

CLSO turns out to have been a highly popular initiative, according to HMRC in a four-part update to the programme. However, the tax authority did admit that the initiative needed a bit of clarification and that some users raised some valid concerns. All in all, the changes are all designed to help users of the scheme settle up accounts and avoid being dragged in front of an HMRC tribunal – something that I’m sure none of us want to have to deal with. I certainly wouldn’t want to have to face the music if I had been caught red-handed using one of these offshore schemes, though I’ll be damned before I’d ever use one myself.

Honestly I think it’s a solid programme and I’d urge anyone and everyone who’s ended up in hot water to get out through using it. Sometimes it’s better to just take your lumps and get on with life, you know?

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