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The tax amnesty (or Offshore Disclosure Facility) has been announced. So what are the key points?
At long last HMRC have published detail of the long awaited tax amnesty. So what are the major points to be considered?
The first matter is one of disclosure of the tax issues under the tax amnesty to HMRC. This can be done online, by post or by letter. Further details can be found at https://disclosures.hmrc.gov.uk or by phone on 0845 3021401.
The initial notification relating to an intention to make a disclosure of tax fraud involving offshore assets and income must be with HMRC by 22 June 2007.
This disclosure will include details of the following:
- Name and address
- Date of Birth
- National Insurance Number
- Tax and VAT reference numbers
It needs to be signed and dated and includes a statement of intent to make a disclosure of all outstanding liabilities.
Once the disclosure has been made under the tax amnesty the individual then has until 26 November 2007 to make a full disclosure of the amounts of tax, VAT or any other duties due, to calculate the interest due on the tax and the penalty (which is a fixed rate of 10%) and to make payment. It is important to note that this must be a full disclosure of all tax irregularities and can cover a period of up to 20 years.
Where there is a tax fraud which involves both a company and an individual (let us say that a director has diverted funds from a company into a private account which has generated interest which has not been taxed) both the company and the individual will have to register separately. Personal representatives can also register with regards to deceased individuals who have had offshore income which has not been declared.
Although all of the documents published by HMRC stress that “you may want to seek independent advice” there is no facility for the advisor to notify HMRC or to “disclose on behalf of their clients”. This seems against the principle that the individual can have his tax affairs dealt with by the agent and we have contacted HMRC to ask for their comment on this matter. This does not mean that an agent cannot act merely that the initial disclosure must be made by the individual. Where this is in the form of a paper document this will not cause problems but if HMRC want individuals to use the online facility or telephone it appears that they are excluding agents from doing this on behalf of the individual.
If you would like to discuss any possible disclosure to HMRC or any matter to do with the potential tax amnesty or how to deal with any tax evasion difficulties please phone 0800 734 3333 or e-mail scott.gilbert@gilberttax.co.uk now
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