A new law will require individuals and trustees with undeclared tax liabilities related to offshore matters to disclose them to HMRC by September 30, 2018, or face much stiffer penalties.
The new Requirement to Correct (RTC) rules are designed to clamp down on individuals with undeclared offshore assets, highlighting the penalties for non-compliance. The rules require taxpayers to notify the tax authority if there is a possibility that money held offshore has not been taxed or reported, including income tax, capital gains tax or inheritance tax.
Any tax which comes to light following September 30 which should have been reported has a maximum 200% penalty and a minimum 100% penalty.
Tax expert Owen Kyffin, director of Whitley Stimpson which is a Top 100 UK accountancy practice with offices in Banbury, Bicester, High Wycombe and Witney, highlights the new law and is keen to offer guidance on how to comply.
He explained: “Taxpayers with unpaid tax must report any outstanding liability to HMRC by 30 September 2018. The deadline coincides with the start date for the introduction of the common reporting standard, at which point more than 100 countries will start exchanging and sharing data on financial accounts between tax authorities. This will make it much harder for individuals to keep offshore assets beyond the reach of HMRC.”
Under the new regime HMRC will have the power to take appropriate action to collect tax, interest and any penalties due.
Kyffin added: “At Whitley Stimpson we have a fully qualified team of people to help advise on any tax issues. It’s important for us to share our knowledge about RTC with our clients and advise them accordingly. We believe this is best done face-to-face to help individuals and businesses understand, calculate, plan efficiently and, if need be, correct.”