Remittance basis foreign income and gains used for loan collateral
See Whats New (now archived) on the HMRC website.
The change concerns remittance basis users who have pledged foreign cash or investments, representing their unremitted foreign income and gains, as collateral for loans used in the UK. From 4 August 2014, in a change to their previous practice, HMRC‚ s position stated that money brought to or used in the UK under a loan facility secured by foreign income or gains will be treated as a taxable remittance of that amount of foreign income or gains. The CIOT made immediate representations to HMRC. A meeting between HMRC and rep bodies followed on 11 September 2014. The agreed note can be found here.
On 15 October 2015, HMRC issued RCB 16/2015 confirming grandfathering for arrangements entered into before 4 August 2014, however, a number of significant issues remain. Immediately following the RCB, a conference call was held between HMRC and stakeholders to continue to address these issues. The note of this conference call can be found here.
During the call it was agreed that a meeting would follow to try to address some of the significant technical issues that remain outstanding, not least in respect of 2014/15 tax return preparation. An update following that meeting on 18 November 2015 can be found here. HMRC has commented on the update, those comments have been incorporated into the note as above.