HMRC tax amnesty likely for offshore accounts

Offshore tax avoiders could be enticed into a partial amnesty by HM Revenue & Customs.

Individuals who avoid tax by stashing money in offshore accounts could be offered an amnesty by HMRC, offering them a capped penalty on top of the tax they have avoided paying in the UK. 

The FT suggested that the penalty would be capped at around a tenth of the tax owed, while interest on unpaid tax would still have to be paid. It is believed that as much as £180bn is stored in offshore accounts by UK residents.

However, sources told Accountancy Age that the total charge on top of the tax payable could be as much as 25%, and further details of the scheme might be released during the pre-Budget report.

The move by HMRC follows its landmark ruling earlier in the year that has enabled the taxman to gain access to Barclays' records of customers with offshore accounts.

With further disclosures expected from other banks, an amnesty could save HMRC from sifting through a mass of information at a time when it is shedding staff to reach efficiency targets.

'They have a mine of information but there's a lot to plough through, so they'll offer an amnesty,' said one source.

Further reading:

Government lands early blow to leasing avoidance schemes

Revenue wins again in offshore battle

Other banks will be hit by offshore clampdown