It is widely publicised that a former member of staff at HSBC’S Swiss division stole highly sensitive data belonging to 15,000 high net worth account holders during 2010 and that he fled to France.

The list was passed to the French tax authorities who used this to conduct tax investigations and then this information was handed to HMRC to use in tax investigations.

Switzerland due to its secrecy laws has long been seen as a safe haven for the wealthy to save their money.  HMRC believe that this is usually done to hide tax evasion and tax fraud.  The tax authorities are keen to access this information and this has resulted (under the guise of stopping terrorism) in a worldwide clampdown on offshore tax havens by the G20 nations and it has been helped by incidents such as the theft of personal information.

HMRC Specialist Investigations section (whom deal with suspected high level tax evasion) has already issued a number letters under its Civil Investigation of Fraud procedures (Code of Practice 9) to people whose names are on the HSBC list.  It is believed that many more letters will be issued soon using the civil investigation of fraud procedures outlined in code of practice 9 as Specialist Investigations comes under pressure to use the HSBC information and to increase its recovery of evaded tax from cases involving serious suspected tax fraud.

In many cases it is likely there will be issues around a person’s residence and domicile position and it could be that no additional tax may be due in the UK.  There is a question mark in these cases about whether HMRC is being heavy handed in its approach by using its Civil Investigation of Fraud procedures (Code of Practice 9).  The civil investigation of fraud procedures should only be issued in the most serious cases of tax fraud and tax evasion.  The process can be costly to the person who is subject to the civil investigation of fraud procedures and if no tax is due as a result of the enquiry there could be claims that HMRC was not justified in using Code of Practice 9 for its tax investigation.

Normally Specialist Investigations only deals with Civil Investigation of Fraud cases under code of Practice 9 in those cases where the suspected fraud is likely to result in tax of £500,000 or more.  Cases involving suspected tax evasion where the tax is between £75,000 and £500,000 are normally dealt with by Civil Investigation of Fraud teams.  It would appear that Specialist Investigations have taken the decision that it will deal with all civil investigation of fraud cases relating to the HSBC information and it is unclear why HMRC has departed from its normal civil investigation of fraud procedurees in cases involving HSBC.

Gilbert Tax Will deal with HMRC for you

For most people, the simple thought of having to deal with an Inland Revenue Investigation is so terrifying that they avoid the issue altogether and often find themselves in even greater tax difficulties. There is no need to let problems large or small with the HMRC escalate to the point where your quality of life and happiness suffer.

At Gilbert Tax, we have over eighty years experience in finding closure for clients dealing with Inland Revenue investigation and significant experience in dealing with the offshore tax evasion issues. We are also skilled in negotiating with HMRC, relative to tax evasion, so as to avoid or limit financial penalties for the individuals or businesses who find themselves subject to a tax investigation.

For a private discussion of your tax matters, please call Gilbert Tax on 0800 734 3333 or email us at scott.gilbert@gilberttax.co.uk

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