Business Finance: Anne Wright explains HMRC’s latest ‘disclosure opportunity’
- Credit: Archant
HM Revenue and Customs (HMRC) has launched new “disclosure opportunities” for UK residents who hold accounts abroad but have not yet declared them, providing them with an opportunity to make full unprompted disclosures to HMRC if they have underpaid tax, and to settle these liabilities.
This follows on from the signing of information exchange agreements with the Isle of Man, Jersey and Guernsey, which will enable HMRC to obtain details from banks of UK residents holding offshore accounts, including account holders’ names, addresses, dates of birth, account numbers and details of payments into those accounts.
Those who come clean will be offered a reduced penalty, possibly as low as 20%, whereas those who do not disclose voluntarily could face penalties of up to 200% of the tax owing. Those who ignore the opportunity to disclose also risks having a formal enquiry opened into their tax affairs, involving a detailed investigation.
The disclosure must be made to HMRC before September 20, 2016, and it must take into account all under-declarations going back as far as April 6,1999 (if applicable), and include calculations. Payment of outstanding liabilities must be submitted to HMRC when the disclosure is made, unless HMRC agree to deferred payment terms. The disclosures will be required to include all undeclared liabilities, not just those connected with an offshore account.
As there is no registration process, there is a danger that HMRC may initiate an investigation while the liability is being calculated or funds are being sought, so early consideration is strongly recommended. Further “disclosure opportunities” will also be made available following the recently announced agreements with the British Virgin Islands, Bermuda and other British overseas territories. As certain accounts held by entities such as trusts are included, the HMRC net really is closing in on those with previously undeclared offshore accounts.
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Anyone wishing to make a disclosure should seek expert advice on how to do it in a way that keeps penalties to a minimum, whilst reducing exposure to further investigation and potential prosecution.
For further information or advice on making a disclosure to HMRC contact Anne Wright on 01473 220022 or email firstname.lastname@example.org
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: : This information is given by way of general guidance only, and no action should be taken solely on the basis of the information contained herein. No liability is accepted by the firm for any actions taken without seeking appropriate professional advice.
: : Anne Wright is manager at Ensors Chartered Accountants.