Net closes on offshore cheats, senior tax manager at the Birmingham office of BTG Tax

The net is closing on anyone who still has cash and valuables stashed abroad hoping it will be safe from the taxman, an expert has warned.

Jeff Millington, senior tax manager at the Birmingham office of BTG Tax, part of the Begbies Traynor Group, stressed culprits had one last opportunity to own up – or face severe consequences.

“What is clear is that the compliance net is closing in on the offshore arena and anyone with undeclared income or gains sheltered there must come clean now to avoid a prolonged, intrusive and expensive tax enquiry,” he cautioned.

Mr Millington noted that in the Budget the Chancellor had given the holders of offshore accounts a second and final chance to come clean if they had unpaid tax or duties outstanding.

He added that it was HM Revenue & Customs’ intention to pursue those who still sought to outwit them, issuing notices requiring financial institutions to provide information about offshore account holders.

The so-called ‘new disclosure opportunity’ is expected to run from this September until March next year, and will offer those who take it up a deal to meet undeclared tax and late payment interest along with a reduced penalty.

It represents a second Offshore Disclosure Facility, a scheme first launched by HMRC in 2007, which enabled it to obtain £400 million from 45,000 individuals at a cost of £6 million to the Treasury.

The windfall was largely due to HMRC’s success in forcing the major high street banks to reveal details of UK residents with accounts abroad.

Mr Millington said: “HMRC is continuing to pursue this avenue of inquiry and recently obtained information from UK-based banks with branches in jurisdictions such as Luxembourg, Austria, Belgium and the Channel Islands.

“It is currently looking to obtain similar information from up to 100 UK-based financial institutions, including private banks, investment banks, building societies and branches of offshore-based banks. Typically the information obtained will comprise the name and address of the account holders – which includes individuals, companies, trustees and nominees if appropriate – annual account balances, annual interest arising and several months transactional data.

“The information obtained will take in the six years prior to the date of the notice.

“Following the recent G20 summit meeting in London and the rush to sign exchange of information agreements between countries, tax havens are high on HMRC’s agenda. There is increased co-operation between countries including learning from one another’s compliance regimes.

“Of particular interest to HMRC is the tackling of tax avoidance or evasion facilitated through offshore centres by way of offshore bank accounts, corporate and trust structures.”

BTG Tax has a wealth of experience in dealing with such matters, making regular visits to the likes of Guernsey and Jersey to advise clients.

BTG Tax is the dedicated tax division of Begbies Traynor Group. Begbies Traynor provides a partner led service to stakeholders in troubled businesses across Great Britain, operating locally through its unique spread of offices, whilst bringing the benefits of its national depth of expertise, and reputation.



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