In its latest one-to-many campaign, HMRC is writing to persons with significant control (PSC) who have not filed a tax return or may not have declared all their income.

The PSC rules require a company to identify all of the people who can control it, and to report this information to Companies House. HMRC has reviewed this information and is writing to the PSC where it believes that that person may need to take action. There are two types of letter:  

The first letter asks the PSC to check their tax return for 2022/23 and to correct any errors by 23 August 2024. The letter includes guidance on how to do this. The person is also encouraged to make sure that their tax return for 2023/24 includes all sources of income and gains. 

The second letter is aimed at PSCs who have not submitted a tax return. The person is asked to check if they need to register to submit a return. If a return should have been submitted for 2022/23, they should register and submit the return by 23 August 2024. However, if they fail to do this, HMRC may charge a failure to notify penalty. The person should contact HMRC using the contact details given in the letter if they do not believe a return is required. 

The letters explain that, if HMRC discovers an error in a submitted return, or that a return should have been submitted, it may open a compliance check.  

Where a return has not been submitted, HMRC has the option of raising a determination. This allows it to estimate the amount of tax due and to collect that amount.   

The letters provide examples of the situations in which a PSC may receive income or benefits from a company for tax purposes. These include: 

• where the company pays the individual’s personal costs; 
• where the individual receives a loan from the company and does not repay it; and
• where the individual uses the company’s assets free of charge.  

What is a PSC? 

Broadly, a PSC is a person who: 

• directly or indirectly owns more than 25% of the shares in a company;
• directly or indirectly holds more than 25% of the voting power of a company;
• has the right to appoint or remove the majority of directors of a company; or
• can exercise significant influence over the company.