An MP has called upon Treasury Ministers to step in and set up a 24-hour mental health hotline for those facing the Government’s deeply controversial Loan Charge policy, which has left contractors facing breakdowns – and some identified as suicide risks.

Stephen Lloyd MP, the Liberal Democrat MP for Eastbourne, made the request on the floor of the House of Commons at Treasury Questions today (3rd July) and expressed his serious concern about the mental health and wellbeing of many facing unpayable bills and bankruptcy as a result of the Loan Charge, a situation described by Mr Lloyd as being “caught in a trap”. A second MP, Peter Aldous, Conservative MP for Waveney, also said in the House of Commons “The retrospective nature of the 2019 Loan charge could bankrupt thousands of people” and called upon Treasury Ministers to revise legislation to prevent this.

Mr Lloyd’s timely plea for an emergency helpline exposes the disgraceful fact that HMRC Chief Executive and Permanent Secretary, Jon Thompson has still to respond to an urgent letter outlining the risk of suicides – and demanding he set up a 24-hour helpline – which was sent to him three weeks ago, from the Loan Charge Action Group (LCAG) https://www.hmrcloancharge.info/blog/lcag-letter-to-jon-thompson.

The lack of reply from HMRC is even more shocking considering that the acute mental health issues being suffered by Loan Charge victims has been reported both to HMRC as well as being in the press.  The Evening Standard first reported the suicide risk on the same day the letter was sent, 13th June https://www.standard.co.uk/business/suicide-watch-the-preventable-tax-timebomb-looming-for-freelancers-a3861916.html .

Disgracefully, just like Jon Thompson, Treasury Minister Mel Stride MP also failed to answer the request directly and would not confirm whether or not he would set up the helpline Stephen Lloyd requested, leaving many contractors without vital mental health support in the crisis they are facing due to the Loan Charge.   

LCAG, an action group representing Loan Charge victims, have had to deal with calls from contractors who have just discovered they will be hit by the Loan Charge and have reported severe mental distress, including suicidal thoughts. Without the resource or skills to deal with this, they have demanded that HMRC and HM Treasury accept the impact the Loan Charge is having and act to assist those in serious distress.  The Loan Charge sees HMRC pushing thousands of contractors towards bankruptcy by seeking to collect tax going back 20 years on working arrangements that were and still are legal and which were never challenged at the time.

A second MP also raised the unfairness of the Loan Charge in the House of Commons today. Peter Aldous, Conservative MP for Waveney criticised the retrospective nature of the Loan Charge and the fact that it will cause many bankruptcies. Mr Aldous repeated the calls, also made by 67 cross party MPs in a parliamentary motion, for the Loan Charge to apply only from the passing of the Finance Act 2017.

Stephen Lloyd MP, who has also tabled a parliamentary motion highlighting the issue, supported by 67 cross party MPs, said in the House of Commons:

“Recent media reports have identified the severe impact of this huge retrospective charge on the mental health of some of the contractors, Mr Speaker, I’ve real concerns about their wellbeing.  Will the Minister commit to setting up a 24-hour helpline to provide support for individuals caught in this trap?”

Peter Aldous MP (Conservative, Waveney) said in the House:

“The retrospective nature of the 2019 Loan Charge could bankrupt thousands of people. Will the Government revise legislation to ensure this does not happen with the Loan Charge only applying to disguised remuneration loans made after the 2017 Finance Act?”.

Richard Horsley, Spokesperson for the Loan Charge Action Group said,

“We don’t have the skills or resources to deal with vulnerable people who are desperate when facing huge bills they can’t pay, so the Government and HMRC must face up to the impact the Loan Charge is having and offer an emergency helpline to such people, some of whom are reporting suicidal thoughts.”

“It is shocking and disgraceful that Jon Thompson, Chief Executive of HMRC, has failed to even acknowledge our letter and address the identified suicide risk, despite knowing about it from the media and from taxpayers affected. Now Mel Stride has also failed to answer a question concerning the fact that people are at risk of suicide and need support, which beggars belief. So we are very grateful that this has been raised in Parliament and thank Stephen Lloyd and Peter Aldous for raising the Loan Charge in the House of Commons”.

Notes to Editors

Media Contact: Mark Sebright – marks@imagenuk.com / 07504 042613

About the Loan Charge Action Group: The Loan Charge Action Group has been formed to raise awareness of the Retrospective Tax charge introduced by HMG in the 2017 Budget and build a community where affected individuals can find information and support. The Group does not provide any form of chargeable service or professional advice.

About the Loan Charge: HM Govt has a nasty surprise in store for anyone miss-sold an Employment Arrangement involving remuneration through ‘loans’ next April in the form of the 2019 Loan Charge. Everyone who has ever been employed through such as structure will be hit with a retrospective charge in the 2018-19 tax year.

Stephen Lloyd’s Parliamentary Motion  states: “This House recognises that the Charge will affect contractors, freelancers and agency workers, including social workers, supply teachers and bank and locum nurses and doctors; notes that employment was not an option and in some cases the company or organisation insisted on those arrangements, including to avoid paying National Insurance… believes it is unfair that HMRC are pursuing people who acted in good faith rather than the client organisations, agencies or umbrella companies all of whom benefited significantly; notes that HMRC are aggressively pursuing individuals…. with no independent right of appeal; further believes that the Charge is likely to cause financial distress and bankruptcies, and believes that retrospectively taxing something that was technically allowed at the time,  is unfair”.

For full register of MPs supporting Parliamentary motion: https://www.parliament.uk/edm/2017-19/1239