Reporting offshore interests to HMRC; voluntary disclosure by taxpayers

Reporting offshore interests to HMRC

HM Revenue & Customs (HMRC) announced a new consultation that takes forward the “no safe havens” strategy for addressing offshore tax evasion. The new consultation includes a proposal that taxpayers who have offshore interests would have a legal “requirement to correct” obligation. Any tax irregularities linked to offshore interests must be corrected by 30 September 2018.

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By 30 September 2018, HMRC would then receive information from approximately 100 jurisdictions—including the Channel Islands—committed to the common reporting standard (CRS). This allows for details of assets and income held offshore to be automatically reported to HMRC. 

HMRC also launched a new “worldwide disclosure facility”—a type of voluntary disclosure system that allows taxpayers with offshore interests to come forward and settle their tax affairs by:

  • Filing with HMRC a notification to disclose
  • Completing the disclosure within 90 days of notification
  • Calculating the tax, penalties, and interest that will be due
  • Paying the tax, penalties, and interest on completion of disclosure

The system can be used by any taxpayer who wants to disclose a UK tax liability that relates to offshore interests, but unlike previous disclosure facilities, the new system will not provide immunity from prosecution.

 

Read a September 2016 report [PDF 82 KB] prepared by the KPMG member firm in the Channel Islands

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