HMRC has won the right to demand compulsory disclosure notices against
hundreds of banks and financial services providers in the UK, as the department
continues its tax evasion offensive.
From today the taxman has the power under Schedule 36 of the Finance Act to
force 308 financial institutions to surrender information on clients with UK
addresses holding offshore interests.
This success comes in the wake of HMRC hammering out a Tax Information
Exchange Agreement with Liechtenstein
a disclosure facility to deal with tax issues arising from Liechtenstein
bank accounts or investments.
David Daly Tax Investigations Partner at Horwath Clark Whitehill said:
‘If it was not abundantly clear already, HMRC are serious about cleansing
offshore bank accounts and any potential UK tax ramifications. HMRC are now
truly flexing their muscles in respect of offshore tax issues.
‘There is now a real incentive for people who have undeclared income
connected with offshore bank accounts, overseas assets or Liechtenstein assets
and investments, to make a disclosure either under the New Disclosure
Opportunity or the Liechtenstein Disclosure Facility. Failing to do so now would
In a statement last week, Simon Airey of law firm DLA Piper said: ‘Virtually
every financial institution in the UK with overseas connections will be
affected. Also of interest to HMRC will be institutions that have processed
payments and transfers on behalf of their clients to overseas bank accounts,
including accounts held with other organisations.’
Institutions will get no advance notice of HMRC’s intention to proceed
against them, Airey added, nor will they be allowed to make representations to
the Tax Tribunal before the application is made by HMRC, Airey warned.
‘The first you may hear of this matter is when you are served with a
disclosure notice which is likely to be within one or two days of 12 August
2009, Airey added. ‘This is probably HMRC’s largest tax evasion initiative to
HMRC said: ‘HMRC can now issue the information notices to banks ahead of the
New Disclosure Opportunity. The NDO will allow people with unpaid taxes linked
to offshore accounts or assets to settle their tax liabilities at a favourable
‘HMRC will use this information to ensure everyone pays the right tax and to
check that NDO disclosures are complete.’
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