PBR 09: Offshore account holders urged to disclose

The taxman has used Alistair Darling’s pre-Budget speech as a last minute PR
opportunity to urge offshore account holders to turn themselves in, according to
tax experts.

Stephen Camm, tax partner with PricewaterhouseCoopers, believes Darling’s
speech was aimed at “waverers” still undecided about whether to take advantage
of the Government’s tax amnesty on offshore accounts.

The chancellor yesterday announced the establishment of a stiff new penalties
regime, which could result in evaders facing combined penalties of up to 200% of
their unpaid tax.

Camm believes the new penalties are aimed at convincing people who have not
yet disclosed their offshore accounts to come forward.

“The only people who haven’t come forward are the people who understand what
is involved but are wavering because the penalties are not strong enough,” he
said.

“I know [that] people I talk to are saying, ‘if itÕ’s a 50% penalty I will
take my chance, but if the penalty is 200 %, I am definitely disclosing it’.

(HMRC) have just changed the risk equation slightly. They have used a PR
opportunity quite well.”

Bill Dodwell, head of tax policy at Deloitte, said the warning of new
penalties leaves offshore account holders little time to make their declaration.

“We only have a month left of the carrot and then they have the stick, surely
it would have been better to wait alittle bit longer with the carrot,” he said.

New measures will also include a demand to disclose offshore accounts when
they are opened. But it remains unclear whether individuals or banks will be
asked to make the disclosure.