Anyone holding undeclared money or offshore accounts has only one week notify HMRC. The official deadline is actually months away, however, an intent to disclose must be made to Revenue and Customs by November 30th.
Anyone failing to notify HMRC within this period of time will not qualify for the New Disclosure Opportunity (NDO) which offers smaller penalties. The usual charges are set at 35% but any taxpayer utilising NDO should only be charged 10% as long as they have not already been subject to a request from HMRC to provide this information.
Dave Hartnett, permanent tax secretary, is hopeful that the NDO will be successful as he believes that the lower charges will be an attractive enough prospect to entice people to come forward. In fact, he is predicting around 100,000 accounts could be settled through this process.
However, Mr Hartnett’s optimism is not backed up by official figures gained by McGrigors law firm which shows an extremely slow take-up of NDO and the Liechtenstein Disclosure Facility (LDF). So far only 27 people have registered for LDF since registration opened on 1st September. HMRC have refused to release figures relating to the take up of NDO.
McGrigors commented: “If it seems that not many people have come forward under the NDO, this may dissuade others from doing so. HMRC must be concerned that the tax amnesties are not bringing in enough tax evaders. Bigger fines are an obvious way to encourage people to comply, although to be effective that must be combined with a real risk of being caught.”
They concluded: “There was a time, in living memory, when HMRC was able to impose penalties in excess of 100% of the underpaid tax. There is an argument that HMRC should be pushing for a return to that level of penalty.”