Offshore bank accounts
HMRC has received authority to require over 300 banks to provide details on their banking customers who hold offshore bank accounts.
In a press release HMRC state that they will use this information to ensure that taxpayers declare the right amount of tax and to ensure that all overseas accounts that are subject to UK tax are properly disclosed. The authority ties in well with the New Disclosure Opportunity (NDO) which begins on 1 September 2009.
A reduced penalty of 10% will be levied for full disclosure where no previous disclosure opportunity had been available to the taxpayer. A higher penalty (of 20%) will apply where taxpayers were contacted by HMRC as part of the Offshore Disclosure Facility (ODF) in 2007 but did not make a disclosure.
This is expected to be the final disclosure opportunity for taxpayers to disclose arrangements without incurring significantly higher penalties. Taxpayers who have not made a disclosure by 12 March 2010 and are found to have undeclared tax liabilities will face penalties of between 30% and 100% of the tax evaded as well as an increased risk of criminal prosecution.