Over the last two years, more than 90 countries worldwide have agreed to the on-going and automatic exchange of financial data relating to offshore financial interests.

That means from 2016 HMRC will begin receiving vast amounts of information concerning overseas investments held by UK resident persons, such as account holder names and addresses, values and balances, together with details of taxable income and gains.

Where does that leave UK taxpayers who have not included income and gains from their overseas investments on their UK tax returns, but who wish to bring their tax affairs up to date?

Voluntary disclosures from 2016

In its March 2015 budget, the Government announced the early withdrawal of the existing disclosure facilities and the introduction of a new disclosure facility, the Common Reporting Standard Disclosure Facility. It is to be available from April 2016 to mid-2017 and will offer taxpayers the chance to make voluntary disclosures of unpaid taxes relating to overseas income and gains. 

The detailed settlement terms will be published in the new year and are expected to include a minimum 30% penalty and no immunity from prosecution. They will not, therefore, be as generous as those offered under the Liechtenstein and Crown Dependency facilities, which close on 31 December 2015. 

How can we help?

Taxpayers who routinely include all relevant overseas income and gains in their tax returns need not be concerned.

Those who do not, however, are best advised to make a voluntary disclosure of any unpaid taxes to HMRC before becoming the subject of a potentially intrusive investigation or even prosecution.

Non tax compliant individuals who do not come forward should expect to be investigated, suffer severe financial penalties and even the possibility  of criminal prosecution if they are identified by HMRC. With detection more likely than ever before, because of the international exchange of financial information, it is crucial that UK taxpayers make sure that their tax affairs are now up to date.

We can help our clients to make disclosures to HMRC and regularise their tax positions. In so doing we can mitigate the associated risks and seek to ensure that settlements with HMRC proceed on the best possible financial terms and help to secure immunity from prosecution. 

We recommend anyone affected by the above scenarios, to contact our expert team immediately, for a no obligation, no fee initial discussion. Together we can achieve the most favourable outcome.

Director, Head of Tax Investigations David Francis

+44 (0)121 2325 425

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