HM Revenue and Customs have announced an amnesty for people who have offshore bank accounts that they have failed to disclose income or those who have undeclared rental income from property overseas. The new Offshore Disclosure Facility will mean that instead of facing penalties of up to 100% i.e. if you should have paid £1,000 in back taxes, you would have been fined a further £1,000 but now, for a limited period the penalty will be just 10%.
Tax evasion is illegal and means law abiding citizens pay more because of those who do not pay. If you are not making accurate tax returns,you must disclose your position now. Failure to do so will result in huge fines when you are caught. Under the HMRC amnesty terms, you are required to notify your intention to make a disclosure by 22 June 2007 and all taxes, duties, interest and penalties be paid by 26 November 2007.
Our view
Our advice is simple, disclose any undeclared income now with a reduced penalty and declare as normal in the future. In addition, please be aware that there are offshore investments, outside of bank and deposit accounts that are able to grow with legitimate tax deferral. Contact us for details.