Offshore disclosure – time limit extension
Taxpayers need to be aware that the deadline for submitting an initial ‘intention to disclosure’ for the current disclosure opportunity has moved from 30 November 2009 to4 January 2010. The deadline has been extended as some banks need more time to notify their customers with offshore accounts.
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 previously hidden income and gains without incurring significantly higher penalties. Taxpayers who submit an ‘intention to disclose’ will then have until 31 January 2010 to make a paper disclosure and until 12 March 2010 to make an electronic disclosure. Following this, taxpayers who 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.
Taxpayers who currently have undisclosed taxable income such as accounts in offshore banks are advised to take action immediately.