The amnesty has serious implications, not just for offshore bank account holders but for the entire offshore sector.
Commentators believe it could signal the start of a major crackdown on offshore investments and once this amnesty has been completed HMRC could widen the net to take a closer look at other forms of offshore products.
From June 22, HMRC says it will start trawling through records of UK customers who hold offshore accounts and will pursue those who have not declared tax owed on overseas savings.
The deal which HMRC is making with investors is to waive the usual penalties which can be anything between 30 and 100 per cent and reduce these to just 10 per cent.
Last year, HMRC won a legal ruling which allowed them to force UK banks to disclose details of customers’ offshore accounts in an effort to recoup revenue from individuals with offshore assets who had not paid tax in full on the interest generated.
Barclays was the first bank involved with an estimated 20,000 offshore account holders which would raise up to £1.5bn for HMRC.
It is estimated that up to 100,000 people could be affected, generating £5bn in tax for HMRC.
Experts such as Aegon Scottish Equitable International technical manager Margaret Jago say people taking part in the amnesty may wish to consider using offshore bonds as an alternative investment to offshore deposits because they have the advantage of legitimate tax deferral.
But the implications are wider than this.
Chiltern head of tax investigations Stephen Besford does not think HMRC will stop at offshore bank accounts. He believes it will spread its net further and pick the easiest route it can to get similar information on other types of offshore investors.
But in the meantime, he advises those with offshore bank accounts to seek advice if they think HMRC will take a particularly dim view of their case.
But on the plus side, this amnesty could lead to the offshore market shaking off the final remnants of its murky image – an image which it does not deserve but which is still all too common among consumers.
If investors see that it is HMRC is clamping down and cleaning up, UK investors may start to view the offshore market as a viable alternative to other investments, rather than a niche sector which must be approached with caution.