Those holding offshore accounts had until 5pm yesterday to inform HMRC that they were planning to disclose money or assets held offshore. Those failing to tell HMRC that they were planning to disclose will be investigated and face penalties of 100% of the tax owed.
A spokesperson for HMRC stated yesterday: “We have received a lot of last minute calls.”
He added: “We received lots of letters today.”
It will not be known for several days how many people have taken advantage of this disclosure opportunity but those who have contacted HMRC now have two options to make full disclosure – by 31st January on paper or by 12th March online. They will then be liable for any unpaid tax the past twenty years plus interest and a ten per cent penalty.
The HMRC spokesperson declared: “They will have to pay the lot – all at once.”
However, Ronnie Ludwig of Saffery Champness accountants said that not everyone disclosing offshore assets will have tax to pay, commenting: “The Revenue has given the impression that merely holding an asset off shore, like a home abroad, needs to be disclosed even though it may not have generated any taxable income or capital gain.”
It is not an offence to hold assets offshore but those who receive an income from investments or savings held abroad must declare this on their tax return.
People who are found to be dodging tax liability will now face tougher penalties as the chancellor declared in his pre-Budget report that the maximum fines for evading tax offshore are to be doubled. This 200 per cent penalty will be effected next year.