HM Revenue and Customs (HMRC) has opened a new Loan Charge Settlement Scheme and is inviting thousands of individuals and employers with outstanding liabilities to come forward. The department says most participants could see their bills cut by at least 50%, with around a third potentially paying nothing. Those who choose not to settle will be required to pay the full Loan Charge amount.

Eligible customers are being contacted directly and urged to respond promptly to their caseworker. Recognising the complexity of these arrangements, HMRC has assigned each customer a named contact to help work through the details and options available.

Jonathan Smith, Director of Counter Avoidance at HMRC, said: “We want to help people draw a line under their loan charge liability and reach a resolution - but that can only happen if you talk to us.

“Some people will see their bills reduced to zero and that is why we need them to engage with us. Our message is simple: get in touch so we can help you resolve this. “You don’t have to wait for your letter from us - you can contact your named caseworker at any time to discuss the settlement opportunity.”

Under the scheme, HMRC will apply a £5,000 reduction to every customer’s bill, remove late payment interest, and can reduce liabilities by up to £10,000 for each year a customer used an avoidance arrangement. Overall, the settlement can lower what a customer owes by as much as £70,000.

Flexible payment options are available. Anyone settling under the new terms can choose to spread payments over five years, with longer plans possible depending on individual circumstances.

The new legislation underpinning the scheme took effect on 5 August 2026. HMRC has begun issuing settlement offers, with a statutory minimum of 90 days for acceptance; most customers will be allowed longer to decide.

Further guidance on the Loan Charge Settlement Scheme, along with a video explainer and details of the Independent Loan Charge Review, is available on

GOV.UK. Customers do not need to wait for a letter to make contact and can speak to their named caseworker at any time.