A Person of Significant Control. This impressive description is how HMRC refers to someone 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.
HMRC introduced the Person of Significant Control (PSC) requirement on 6 April 2016. From this point, companies became obliged to identify people with significant control regardless of the number of layers of ownership involved.
Much of these details can be found on the Companies House website, readily available publicly and to HMRC. The Wealthy team at HMRC is actively contacting some individuals on the PSC register. Letters are being sent that those PSCs who have declared income of under £100,000, or who have not submitted a tax return.
The letter is a form of blanket communication to groups of PSCs rather than a consequence of audit or analysis. It invites taxpayers to consider their interactions with each company they are involved with as a PSC. Examples of interactions include:
- benefits received from the company
- receipt of a share option
- disposal of shares
If a PSC identifies additional income or gains and their tax return for 2021/22 is already submitted, relevant details can be included within their 2021/22 tax return.
If a PSC has not yet submitted a tax return for 2021/22, they can use the HMRC online tool to check if a self assessment tax return is required.
Are you a Person of Significant Control?
Have you received a letter from HMRC?
Talk to the friendly experts at re:accounts. Our superpower is minimising tax payments for our clients. We’d love to help save you some money. Let’s go!
