Widen offshore amnesty, experts demand

Jersey: tax haven

A new amnesty launched by HM Revenue & Customs for taxpayers with bank accounts overseas has failed to clarify the position of people with tax liabilities at home in the UK, experts claim.

The amnesty, or new disclosure order (NDO), has been launched for people who owe tax on interest earned in offshore bank accounts and offers lenient penalty terms.

But experts have complained the special terms should be offered to taxpayers with onshore tax liabilities to settle too.

Gary Ashford, national head of tax risk and dispute resolution at RSM Bentley Jennison, said the NDO is unfavourable for those with onshore outstanding tax liabilities.

‘This could create an unfair position for those with UK only problems,’ he said.

‘It would be better to create a disclosure opportunity for all irregularities, other than the most serious, whether it is offshore or onshore, for the period of the NDO.’

Ashford said the NDO would be more effective if the terms took into account taxpayers with all liabilities – onshore or offshore.

‘It is clear from the amount of guidance currently available that HMRC wants to help as many people as possible to use this facility and come forward as early as possible,’ he said.

A statement from HMRC said the department would be conducting ‘a new disclosure initiative that will allow people with unpaid taxes linked to offshore accounts or assets to settle their tax liabilities at a favourable penalty rate’.

In the statement, Dave Hartnett, permanent secretary for tax at HMRC, omitted to include onshore tax liabilities as part of the NDO.

Hartnett said: ‘This will be the last opportunity of its kind.’

The Chartered Institute of Taxation said HMRC has failed to discuss purely onshore disclosures and will continue to seek guidance.