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The Contractor Loan Settlement Opportunity (CLSO) was introduced by HMRC and is available for anyone who engaged in a Contractor Loans scheme before April 6 2011.
These were marketed as tax avoidance schemes, but HMRC has made it clear that these schemes do not work and has offered a limited time period for contractors to 'settle on clearly defined terms tailored to your personal circumstances'.
It has advised contractors to contact HMRC by June 30 2015 to take advantage of favourable terms.
As with many of the 'carrot and stick' schemes from HMRC, there is an opportunity for people to declare their financial situation to the tax man who will looks benevolently on them. After the deadline, there is the threat that the 'stick' of higher penalties and interest will be used.
HMRC warns: "Around 99 per cent of contractors and freelancers do not use avoidance schemes. So if you are using a contractor loan scheme, you are firmly in the minority. Come forward now to ensure you do the right thing."
For more information see: Contractor Loans Settlement Opportunity HMRC, June 2015)
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Susie Hughes © Shout99 2015
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