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Time running out to take advantage of HMRC’s ‘Tax Amnesty’ - 14/10/2009

Anyone with unpaid taxes linked to offshore accounts or assets has less than seven weeks to disclose their accounts to the government, or face tough penalties warns Catherine Scott, a former HMRC inspector and tax specialist at Stockton accountants Baines Jewitt.

Under the New Disclosure Opportunity (NDO), designed to wring extra revenues from the tax system, the penalty for disclosure of income connected to a previously undeclared offshore account will be just ten per cent (or 20 per cent if you failed to disclose after HMRC wrote to you during the 2007 ‘amnesty’). This is substantially lower than the normal penalties.

To take advantage of the opportunity, the disclosure has to be registered with HMRC by Monday, 30 November.  There will then be a period until 31 January (for paper filing of details), or 12 March (for on-line filing of details) to provide all the information to HMRC, along with the payment of the tax, interest and penalties.

HMRC have emphasised that this will be thefinal opportunity for people to take advantage of the favourable treatment.

“HMRC are likely to know if you have any offshore accounts,” Catherine says.

“In August 2009 HMRC confirmed that more than 300 banks have been ordered to provide details on customers who hold offshore accounts. While HMRC have not guaranteed that people making disclosures will be protected from prosecution, their guidance states prosecution would be extremely unlikely other than in exceptional circumstances, such as the liability arising from serious organised crime.”

If people do not come forward during the NDO period, the penalties on any additional liabilities will be between 30 and 100 per cent of any unpaid taxes. In addition, there will be a higher likelihood of prosecution, and the possibility of being publicly ‘named and shamed’.

Catherine adds: “It is better to sort through your options now than face far higher penalties at a later date.

“By seeking professional advice you can review whether a disclosure is required, and obtain advice on what information is required to ensure that the disclosure is full. An advisor such as myself can liaise with HMRC directly on your behalf, and use their expertise to ensure the process is completed as smoothly, and affordably, as possible. As an ex HMRC inspector I know what information may be required, and what questions HMRC may ask”

For more information, contact Baines Jewitt on 01642 632032

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