Advisers will need to inform clients of new changes to offshore tax disclosure as the government introduces a new legal requirement to correct past failures, experts warn.
As part of the Autumn Statement today, the Government said it would put in place a new legal “requirement to correct” a past failure to pay UK tax on offshore interests, with new sanctions for those who fail to do so.
The relevant information will need to reach HM Revenue and Customs by the end of September 2018 as the government eyes introducing the measure in next year’s Finance Bill.
BDO tax dispute resolution partner Dawn Register says: “HMRC is putting people on notice that if they do not put their UK tax affairs in order by 30 September 2018 then the consequences will be severe. With a no excuses policy.
“This is going to shine a spotlight on individuals with any offshore related tax matters, to check and double check that their UK filings are accurate.”
“Advisers are also going to feel under pressure to ensure there are no technical mistakes. We expect this will lead to an increase in voluntary disclosures prior to the expected deadline of 30 September 2018. By making this a legal requirement, HMRC is really giving teeth to the message that people who do not get their tax affairs in order will face severe consequences.”
Meanwhile, the Government will also be consulting on a law for advisers arranging complex structures for clients holding money offshore forcing them to declare the structures and the related client lists to HMRC.