A group representing contractors and freelance workers in the UK have taken the unprecedented step of calling on HMRC to set up a 24-hour Suicide Hotline to deal with ever increasing volumes of calls from people reporting suicidal thoughts as a result of the 2019 Loan Charge.
Hundreds of freelance workers are reporting suicidal thoughts as a direct result of HMRC’s aggressive pursuit of tax bills relating to the 2019 Loan Charge Legislation with people desperately seeking support and some on ‘suicide watch’ as reported in the Evening Standard.
These include nurses, doctors, teachers, social workers, IT and oil & gas contractors who have been mis-sold employment arrangements by employers and agencies, and now face retrospective tax bills running into hundreds of thousands of pounds.
Volunteer support organisation, the Loan Charge Action Group (LCAG), is being inundated with calls and messages from distressed freelance contractors that it is not resourced to handle and therefore has written to HMRC Chief Executive and Director General, Jon Thompson, calling on HMRC to take responsibility for the devastating effect this ill-considered policy is having and take immediate action.
The letter demands that he ‘establish, as a matter of urgency, a 24 hour helpline that individuals may call when in severe mental distress and/or having suicidal thoughts, with the suicide risk being a direct result of your relentless pursuit of individuals, including our members.’
LCAG has collated almost 200 impact statements from distressed contractors such as this message received earlier this week: ‘I used this scheme for 3 years and HMRC is asking me for £103,000. I earn £30,000, my wife cannot work, I have three children and cannot see how we can manage. We have contacted social service because we know we won’t be able to afford taking care of them. Living a nightmare where life is very empty. Depression… and fear every hour, every minute. Tired’
The 2019 Loan Charge is a retrospective tax introduced by HM Government in the 2017 Budget which reclassified UK contract workers under IR35 tax legislation, and consequently liable for retrospective tax bills as full-time employees going back up to 20 years, despite never having received the benefits of full time employment such as holiday and sick pay.
The Charge potentially affects tens of thousands of contractors, freelancers and agency workers including social workers, supply teachers, bank and locum nurses and doctors who were recommended to become self-employed under umbrella companies by employers, professional advisors and employment agencies, and now face personal bankruptcy as a result.
The schemes, which were perfectly legal at the time and meant to facilitate flexible short-term working contractors, also enabled private and public sector employers, notably including the NHS, to avoid billions of pounds in VAT and NIC contributions, which HMRC is now seeking to recover from ordinary hard-working people.
Liberal Democrat MP Stephen Lloyd has posted an early day motion signed by some 61 cross-party MPs already including Liberal Democrat leader Sir Vince Cable, Green Party co-leader Caroline Lucas, former Conservative mayoral candidate Zac Goldsmith, and senior Labour MP Jon Cruddas, calling for the Government to change the legislation so that Loan Charge applies from 2017, not retrospectively back as far as 1999 which is what is causing the mental health crisis for so many people – 2019 Loan Charge Signatures.
LCAG spokesperson, Richard Horsley, commented:
“We are deeply concerned about the effect this invidious and ill-considered policy is having on people’s mental health and on their daily lives. It is currently falling to us, as an action and victim support group, to deal with the devastating personal impact and potentially disastrous consequences.”
“Whilst our role is to challenge the unfair basis of the Loan Charge and to seek to work with HMRC, HM Treasury and others to reconsider the policy, and support those affected, we are not professionally trained to deal with people at risk of, or threatening suicide. Nor should we have to do so, when the Loan Charge is something the Government are forcing upon us, and HMRC is implementing regardless of its legitimacy, or the mounting evidence of the severity of the consequences of doing so.”
“These victims never set out to avoid tax. They were simply following professional advice, often as a requirement of their contact employment. HMRC must accept responsibility for their implementing this policy and the consequences of doing so. The ‘vulnerable customer policy’ is not sufficient nor will it prevent mental breakdown or suicides, so they must set up a hotline and deal with the consequences of this policy and their unfair pursuit of people who are at risk.”
Dr Iain Campbell of the Independent Health Practitioners Association (IHPA), some of whose members are being forced into National Insurance and VAT avoidance umbrellas including doctors and nurses, said:
“As a medical practitioner, I must voice my disbelief that HMRC could preside over such an aggressive policy, which is adversely affecting so many people’s mental health, with some even pushed to the brink of suicide, and others suffering panic attacks and extreme stress, without even subjecting the policy to a proper analysis of its impact. This is a serious failure of the state’s Duty of Care towards these patients and not an act worthy of a developed country.
An urgent enquiry is needed. I would urge anyone affected please to make contact with their GP to access appropriate help and support”.