The Government has set out tough new measures to tackle offshore tax avoidance and evasion, including tax penalties of 200 per cent.
Chancellor Alistair Darling said he would be introducing anti-avoidance and smaller tax measures to safeguard existing revenue and deliver additional revenue streams.
He said: “Since the Budget, Her Majesty’s Revenue and Customs has asked for details of offshore accounts held in over 300 financial institutions and this pre-Budget report sets out anti-avoidance and smaller tax measures to deliver additional revenues and protect £5bn a year of existing revenues.”
Measures include a new notification requirement for offshore accounts in certain jurisdictions, supported by a separate penalty. It says evading tax offshore could therefore result in combined penalties of up to 200 per cent.
Law firm and tax specialist McGrigors partner Jason Collins says: “The maximum penalty for tax evasion is 100 per cent of the unpaid tax, so this doubling is a dramatic ratcheting up of the pain for taxpayers with undeclared income in offshore accounts.”