The Loan Charge has been linked to at least ten suicides and the policy is still in force

The Loan Charge was introduced to deal with disguised remuneration, an arrangement under which people were paid through loans that were never intended to be repaid and which therefore escaped income tax and National Insurance. The tax avoidance was real and the Treasury was entitled to address it. What followed was a different matter.

Who the policy actually caught

A large proportion of the people affected were contractors working as IT specialists, nurses, locum doctors and social workers, who had been placed into these schemes by recruitment agencies and umbrella companies, frequently as a condition of getting the work and often on professional advice that the arrangement was compliant.

The charge then reached back across many years of earnings and crystallised the entire liability into a single moment. People faced demands larger than the value of everything they owned, and faced bankruptcy over arrangements they had neither designed nor fully understood.

The deaths

The policy has been linked to at least ten suicides. That figure is not a campaigning estimate. It is the number that has driven sustained parliamentary scrutiny and two separate independent reviews.

A tax policy with a body count is not a technical disagreement about the correct treatment of loans.

The second review

Ray McCann, a former President of the Chartered Institute of Taxation, was appointed by HM Treasury to lead a second independent review, opening a call for evidence in March 2025. HMRC paused settlements by request while the review was under way.

McCann made nine recommendations, designed to create a means by which everyone who wants to settle their tax position through agreement with HMRC is able to do so. The government accepted all but one of them and in places went further than the review had proposed, including writing off £5,000 of each individual’s liability. HMRC subsequently opened a more favourable settlement opportunity for those who had not yet settled.

Why this remains a scandal

Every concession listed above was available to be made years earlier. The legal arguments did not change between the introduction of the charge and the McCann review. What changed was the accumulated political cost of the deaths, the sustained pressure from the Loan Charge All-Party Parliamentary Group, and two reviews that the Treasury had resisted.

It is also worth noting who has not been pursued with anything approaching the same energy. The scheme promoters who designed and marketed these arrangements, and the agencies that made participation a condition of work, have largely escaped consequence. The liability landed almost entirely on the worker at the end of the chain.

If you are struggling, Samaritans can be reached free on 116 123 at any hour. TaxAid provides free advice to people on low incomes with tax problems.