FCA publishes statement on demands for repayment of disguised remuneration scheme loans

On 2 November 2026, the Financial Conduct Authority (FCA) published a statement concerning demands being made for the repayment of loans, or purported loans, originally provided as part of disguised remuneration schemes.

Background

The FCA explains that disguised remuneration schemes typically involve individuals, including contractors, consultants and agency workers, receiving payment for work through loans rather than ordinary salary, with the intention of avoiding tax. HM Revenue and Customs (HMRC) has subsequently sought to address such arrangements through what has been referred to as the loan charge and has published guidance for affected individuals.

Summary

The FCA highlights that questions have been raised about the regulatory status of these loans and whether they were ever intended to be repaid and that some of those affected dispute liability for the amounts being claimed and challenge whether the debts can be legally enforced. If they’re unenforceable, borrowers cannot be forced to pay the money back or have any of their assets seized against the debt without a specific order.

The FCA also sets out that some consumers are, however, being sent legal letters threatening potential court action and asking for immediate repayment of the loan. Repayment is being sought after these disguised remuneration loans were sold by the original provider to a third party.

However, the FCA also reminds firms that those seeking payment may ask the FCA to agree to a Validation Order. This is the formal permission needed before the loans could be enforced. The FCA make clear that it would consider any request carefully, but its agreement is not guaranteed, such that if a Validation Order is required and not granted the debt would remain unenforceable.

Next steps

The FCA encourages anyone receiving a repayment demand who is uncertain about liability to consider carefully whether to make a payment, consult HMRC guidance and consider obtaining legal advice.

The FCA also emphasises that consumers should not be subjected to undue pressure when contacted about a debt and encourages those experiencing such behaviour to report it to the regulator.