Posted by James Pearson on 06 Mar 2014
Offshore Tax Evasion: An HMRC Briefing
HM Revenue & Customs (HMRC) have issued a briefing explaining the actions they have been carrying out to reduce offshore tax evasions, such as the use of non-UK bank accounts/investments to evade UK tax, and their latest campaign targeted at it.
No Safe Havens
HMRC say that significant progress has been made within the G8 group of leading economies around introducing greater levels of tax transparency, and HMRC’s own “No safe havens” strategy, which was first published in Budget 2013, has led to:-
- £1 billion in additional taxes and penalties being collected via offshore disclosure facilities.
- The introduction of tougher sanctions such as 200% tax-geared penalties, criminal prosecutions and publishing the names of deliberate defaulters.
- Exploiting information provided by third parties, with much more information expected when the new automatic exchange of information agreements come into place in 2016.
- The investment of £3 million in HMRC to develop new approaches and 2,500 extra staff joining specialist offshore tax evasion teams.
Furthermore, internationally the UK is working with the Crown Dependencies (e.g. Jersey, Guernsey and the Isle of Man), Switzerland and Lichtenstein to collect unpaid tax on offshore assets via the disclosure facilities which are now in place.
HMRC’s message to the UK taxpayer is clear as they stated:-
“Are you hiding any undeclared income offshore? New international agreements will let us see more information about your overseas accounts, so the net is closing in on you. If you’ve declared all your income then you have nothing to worry about. But if you haven’t and we catch you, you will have to pay your undeclared tax, a penalty of up to double the tax you owe and you could even go to prison.
People with taxable income in offshore accounts have the opportunity to come forward via our disclosure facilities before they close in 2016. We are urging them to do so and take advantage of these facilities before it is too late.”
We have extensive experience in our team of managing HMRC offshore disclosures and can help you decide the best route to minimize your exposure before guiding you through each step of the process.
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