TaxAdministrationRevenue begins offshore accounts crackdown

Revenue begins offshore accounts crackdown

HM Revenue & Customs has stepped up efforts to curb the number of people evading tax through offshore bank accounts

Tax authorities have sent out about 500 letters to people with funds in
offshore tax centres, giving investors 30 days to explain why they haven’t
declared interest on income in the UK.

The Revenue is also increasingly requesting banks divulge information on UK
citizens who hold accounts offshore.

The move is part of a pilot test by the Revenue to tackle a ‘significant
problem’ of UK citizens using offshore bank accounts to avoid paying tax on
interest accrued.

‘These letters are about ensuring that those with off-shore accounts pay the
right tax like everyone else. Our aim is to avoid the need to open a formal
enquiry if at all possible and to ensure that the rules have been followed. We
have issued these letters in order to achieve this on an informal basis and with
the minimum of fuss,’ said the Revenue.

Offshore accounts are legitimate investment vehicles as long as people
declare any interest that arises in their tax returns. ‘however, we very often
find them associated with serious tax evasion,’ the taxman said.

In May the Special Compliance Offshore Fraud Group signalled its intention to
take a stricter line with those who hold offshore bank accounts when it
appointed 11 new investigators.

But tax experts have voiced concerns that the crackdown could target innocent
taxpayers because authorities won’t have time to conduct in-depth reviews.

The British Bankers’ Association said it is in regular talks with the Revenue
and although tax authorities can request specific information on accounts
holders it must go through the correct channels.

The UK initiative follows the introduction of the European Union savings
directive last month requiring offshore centres to share information on bank
accounts of EU citizens or levy a withholding tax.

The crackdown on tax evasion has accelerated this year in the UK this year as
part of a multi-pronged plan to tackle corporate and personal tax evaders in a
bid to recoup millions in lost taxes each year.

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

4d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2w Emma Smith, Managing Editor
HMRC issues updated Trusts Registration Service guidance

Administration HMRC issues updated Trusts Registration Service guidance

3w Emma Smith, Managing Editor
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
‘Improve rather than lose’ disincorporation relief, tax body urges

Administration ‘Improve rather than lose’ disincorporation relief, tax body urges

3m Austin Clark, Reporter
Are you ready for the Trusts Registration Service?

Administration Are you ready for the Trusts Registration Service?

3m Helen Thornley, ATT Technical Officer
Advisers bullish despite Brexit concerns

Accounting Standards Advisers bullish despite Brexit concerns

1y Fraser Simpson, Reporter
Brexit: Five questions accountants should be asking

Accounting Firms Brexit: Five questions accountants should be asking

1y Fraser Simpson, Reporter