According to Grant Thornton private client team director Chris Mills, HMRC’s push into offshore jurisdictions has the potential to strip offshore banking facilities of their ability to operate on a level playing field in respect of legitimate account holders.
He warns that the agreements between tax authorities coupled with the ever-changing governance of offshore funds and recent non-dom legislation has clouded the legitimate benefits of offshore banking.
He says: “The waters are being muddied as to what remains legal and it can be perceived that ‘offshore’ automatically means ‘tax evasion’. As has been the case in the past, the stampede to catch tax evaders is invariably going to catch legitimate account holders in the crossfire.”
Grant Thornton also warns HMRC will introduce a more stringent facility for those holding untaxed assets in offshore accounts forcing them to disclose and pay any tax owed as they seek out undeclared offshore revenue.
Mills says: “Hopefully HMRC will keep balancing the need for safeguards for those who are not tax evaders as it pursues missing tax revenues.”