From Contractor UK

“Revenue closes the net on offshore tax evaders”

Brits sheltering cash offshore are being urged to come clean before they become the subject of a record number of data requests that HM Revenue & Customs is making to the UK’s crown dependencies so it can investigate tax evaders.

Addressing both businesses and individuals, law firm Pinsent Masons said those hiding money in Bermuda, the Cayman Islands and other UK tax havens should go forward to HMRC or risk becoming part of its growing crackdown.

In fact, the number of requests for financial data HMRC made to the UK’s crown dependencies and overseas territories on suspected evaders of personal and business taxes hit a record high in the last year, the firm showed.

Pointing to figures for the year ending Dec 31st 2012, it said that HMRC made 72 requests for information such as bank account details to the major tax havens, representing a 26% increase on the 57 it made in 2011 (and the 32 requests in 2010).

Pinsent Masons’ director Reg Day reflected: “HMRC are stepping up their efforts to track down tax evaders by getting offshore tax havens to provide more and more information about money being sheltered offshore.

“This will send shivers down the spine of those individuals and business with any undisclosed assets in places like Bermuda and the Cayman Islands. HMRC is closing the net and will come down heavily on those not paying tax”.

The warning coincides with new information-sharing agreements HMRC has put in place with the offshore ‘havens’, which will allow the tax authority to automatically obtain an unprecedented level of data about offshore bank account holders.

“Individuals and businesses with money sheltered offshore should get on the front foot before HMRC finds out and begins an investigation,” said Day. “[Particularly as HMRC will soon receive] much more of the information it needs to start enforcement action against individuals and businesses it suspects of tax evasion.”

Taxpayers are able to declare any offshore assets to HMRC via the Liechtenstein Disclosure Facility – a tax amnesty limiting the risk of criminal prosecution and offering a lighter penalty regime.

The LDF is also open to Brits who have “tax irregularities” from their use of offshore havens, and allows them to disclose and settle their tax liability, thereby avoiding action from HMRC.

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