HMRC letter re Person with Significant Control – making sure your return is correct – don’t worry, we have you covered.

HMRC letter re Person with Significant Control

We have recently been contacted by HMRC to inform us that they have been writing to company shareholders to inform them of their statutory requirements to include certain financial information in their annual tax returns.

The first part of the letter is shown below.

 Person with significant control -making sure your return is correct

Our record show that you are the ‘person with significant control’ (PSC) for XXXXXXXX. We want to make sure that your return is complete and correct. This is not a formal compliance check into your Self-Assessment tax return.

A PSC is someone that holds more than 25% of shares or voting rights In a company and (either)

• has the right to employ or remove most of the board of directors
• has significant influence or control in a company

As a PSC you should be aware that there may be tax consequences for you as an individual if you (any of the following

• use the company to pay for personal costs
• have the use of business assets
• transfer personal assets to or from the company
• receive loans and do not pay interest at an official rate
• receive loans which you do not pay back
• take up an option to buy shares
• dispose of shares, property or other assets relating to the company

What you need to do now

Please make sure your Self-Assessment tax return for the tax year 2021 to 2022 Includes all sources of Income and gains. This includes any that are listed above.

You can amend your tax return for the tax year 2020 to 2021 to correct any errors you may have made. You can do this by (either):

• logging on to your HMRC online account -to do this, go to www.gov.uk, search ‘self assessment tax returns’ and then select the link for ‘if you need to change your return’
• writing to us at the address shown at the top of this letter

Please make sure you do this before 31 January 2023…

If you have received a letter like this, it will be because you own your own business or are a significant shareholder in a business.

If we are doing your accounts and self-assessment you do not need to take any further action as we will ensure that your returns comply with all HMRC guidelines.

If we do not do your annual returns either for your business or you personally and you are concerned that your returns do not comply please contact us and we can review your accounts and give you any help you need.