Private client team director Chris Mills says the legitimate benefits of offshore banking have been clouded by recent agreements between tax authorities coupled with changes to the governance of offshore funds and reforms to the taxation of non-domiciliaries.
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 inv- ariably going to catch legit- imate accountholders in the crossfire.”
Mills warns that offshore banks could be restricted in their ability to operate.
Grant Thornton tax investigations director Gary Ashford adds that HMRC could soon introduce a more stringent facility for investors who hold untaxed assets in offshore accounts.
Tax Briefs director Danby Bloch says: “HMRC tends to blur the lines between tax avoidance and tax evasion and often does so deliber- ately. It seems to regard aggressive tax avoidance as akin to tax evasion.”