ICAEW.com works better with JavaScript enabled.


HMRC nudge letters: Persons of significant control


Published: 01 Nov 2022 Update History

HMRC has issued a new round of one-to-many letters aimed at persons of significant control (PSCs) who have declared income of below £100,000 or who have not submitted a tax return.

Before the PSC regime was introduced, UK companies only needed to record the immediate, legal owners of their shares and submit these details to Companies House. Since 6 April 2016 under the PSC regime, companies have to look through however many layers of ownership there are, to identify relevant persons who ultimately have significant control of the company.

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.

As much of the information about PSCs is available on a public register at Companies House, it is also available to HMRC. HMRC’s Wealthy team is sending two different nudge letters to some individuals listed on the PSC register.

The first letter is directed at individuals who appear on the PSC register and have submitted 2020/21 tax returns declaring income of less than £100,000. The second letter is targeted at PSCs who are not currently submitting self assessment tax returns.

The letters invite taxpayers to consider whether there are any undeclared tax consequences of their interactions with the company of which they are a PSC. This includes benefits received from the company, receipt of a share option or a disposal of shares.

Where additional sources of income or gains are identified, HMRC asks taxpayers who have already filed to amend their 2020/21 tax return and to include anything relevant on their 2021/22 tax return.

Taxpayers who have not filed a tax return for 2020/21 are asked to check whether they need to file a tax return using HMRC’s Check if you need to send a Self Assessment tax return questionnaire.

Letters were sent to taxpayers and their agents in late October 2022.

Further guidance on the PSC register can be found here.

The Tax Faculty

ICAEW's Tax Faculty is recognised internationally as a leading authority and source of expertise on taxation. The faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

More support on tax

ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.

Sign up for TAXwireJoin the Tax Faculty

More from the Tax Faculty

Latest news
Making tax digital image

Stay up to date with the latest developments in tax by signing up to the Tax Faculty's weekly e-newsletter

Practical guidance

Comprehensive support for Tax practitioners each month from the Tax Faculty and expert contributors.

Technical support
Tax Faculty image

Expert advice from the Tax Faculty's technical managers on all the developments in tax policy and practice.