MPs have accused HM Revenue and Customs chief Jon Thompson of evading questions over possible suicides linked to the agency’s new “loan charge” on a type of tax-avoidance scheme.
Thompson wrote to the Loan Charge All Party Parliamentary Group last week to call on campaigners to put forward evidence for their claims that the charge had led people to take their own lives. The charge will seek repayments, sometimes worth several thousand pounds, from tens of thousands of people who have utilised so-called “disguised remuneration” schemes over the past 20 years.
The disguised remuneration schemes were used to pay people, often contractors or consultants, in the form of loans that HMRC says were never repayed. This meant employers did not have to pay National Insurance contributions and recipients – often acting on the advice of accountants or other sources – avoided paying tax on the payments, which HMRC is now trying to recoup through the loan charge.
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Since the loan charge was announced in Budget 2016, government has urged people to repay the original loan or agree a settlement with HMRC to avoid paying the loan charge when it comes in to force in April.
MPs on the APPG, which is chaired by former cabinet minister Sir Ed Davey, said they had heard evidence that HMRC was aware of at least six suicides connected to payments shortly to fall due. They asked Thompson to “respond to us and tell us how many suicides of people facing the loan charge HMRC are aware of”.
In his response, Thompson said HMRC recognised the charge would have a “significant impact on some people” and that he was personally concerned about reports of people taking their own lives that had been shared online and by the APPG.
Thompson said HMRC was aware that the campaign group the Loan Charge Action Group and other social media sources had made “a number of references” to people taking their own lives in relation to their charge liabilities since November last year. He said one complaint on the issue had also been lodged directly with HMRC.
“Despite both direct approaches to individuals and repeated requests to LCAG, no information has been provided that has enabled us to identify an individual that we can link to both taking their own life and the loan charge,” he said.
In their response to Thompson’s letter, dated 15 March, Davey and vice-chairs Ruth Cadbury and Ross Thomson accused the HMRC perm sec of having “evaded the question we asked of you”.
“The key question in our letter was clear and in bold, and as follows: Can you, as a matter of urgency, respond to us and tell us how many suicides of people facing the loan charge HMRC are aware of?”
The MPs said they were concerned that Thompson had given “the clear impression that HMRC are not aware of suicides of people in this position”.
“We find it inconceivable that this is the case, considering that we have been told by an HMRC whistleblower and have now been informed of three suicides of people that are directly linked to the loan charge.”
The MPs said that “the evidence we have clearly shows that HMRC’s whole approach is a direct cause of the acute anxiety and stress people subject to the loan charge are experiencing” and called on Thompson to respond as soon as possible.
“We require an urgent answer to the question as to how many suicides of people facing the loan charge we are aware of. We will not accept a second attempt to evade this question and we look forward to receiving your answer as a matter of priority.”
A HMRC spokesperson told CSW that it had received the letter and was considering a response.
People affected by these issues can contact the Samaritans on 116 123 or www.samaritans.org.