Taxpayers with undeclared onshore liabilities could use the government’s new
offshore disclosure amnesty to confess to have their penalties capped, it became
clear this week.
HMRC revealed on Tuesday that its offshore tax amnesty, known as the offshore
disclosure facility, should also be effective for onshore tax evasion
disclosures before the 22 June cutoff date.
‘If you approach an HMRC office and then make a full disclosure with payment
under the same terms as within this facility, you can expect the same
treatment,’ stated HMRC.
Tax and interest for up to 20 years of disclosure will have to be paid, along
with a 10% penalty, under the terms of the offshore disclosure facility. But
advisers are worried about how local tax inspectors will interpret the
wide-ranging implications of the amnesty.
‘We’re not sure how non-offshore disclosures will be handled and little
attention has been paid to this,’ said Steve Besford, head of tax investigations
at Chiltern. ‘There is concern that tax investigators won’t treat disclosures in
the same way.’
‘I’ve spoken to two tax investigators this week who knew nothing about the
plans,’ said one senior adviser.
‘We do have concerns that the scope of the initiative is extremely wide and
that, at the moment, there is very little guidance for those with purely onshore
irregularities,’ said CIoT president John Cullinane.
KPMG tax investigations partner Reg Day said HMRC was explicit in its
inclusion of onshore tax evaders. ‘[Onshore disclosures] can expect the same
treatment,’ he said. ‘HMRC can’t offer the scheme to just one part of the
taxpaying community, although they haven’t openly advertised this point.’
The taxpayer must notify HMRC by 22 June that a disclosure will be made. They
then have to make the full payment by 26 November.
HMRC has estimated it could make a £1.75bn haul from the offshore scheme,
after gaining access to the offshore account details from five major banks.
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