Offshore income – tax body calls for ‘last chance’ disclosure facility

The Association of Taxation Technicians (ATT) has called for taxpayers to be given a ‘last chance’ to declare offshore income and gains before the introduction of a tough new penalty regime. Giving people a final opportunity to come clean before the new regime kicks in will increase revenue to the Exchequer at little cost to HMRC, the Association argues.    

The ATT sets out its views1 in response to a government consultation on tackling offshore tax evasion. Government proposals include higher penalties for non-disclosures relating to Inheritance Tax and new sanctions to deter people from moving assets in order to keep them hidden2. 

ATT President, Natalie Miller, commented:

“It is right to take a strong line against people who try to hide money from the taxman. However it also makes sense to do all we can to persuade them to come forward voluntarily to put their tax affairs in order.

“There have been various facilities designed to encourage voluntary disclosure of offshore income and gains. However, these are not well-known or understood by the general public. The prospect of a significantly tougher penalty regime provides a strong incentive to taxpayers to clean up their act and make a last chance voluntary disclosure.   

“There may be a wide variety of circumstances and undisclosed liabilities that taxpayers wish to report. Therefore, the design of any such disclosure facility should include a well-resourced helpline and clear guidance on how and who to contact. There should also be an opportunity for taxpayers (or their agents) to correspond with HMRC in advance of any detailed disclosure.

“Providing such an opportunity would help both taxpayers and HMRC. Those who want to become compliant could do so simply, and the Exchequer would benefit from a flow of revenue with very little commitment of HMRC’s limited resources.

“Applying penalties for non-disclosure of the assets of a dead person for Inheritance Tax purposes will need to be done with care. The personal representatives of the deceased can only be expected to make reasonable enquiries. They cannot be expected to pursue speculative enquiries about the possible existence of offshore assets of which they have no reason to have any knowledge.

“The Association stands ready to discuss detailed aspects of these significant proposals with HMRC.”

Notes for editors

1.       The submission of the Association of Taxation Technicians can be read in full, here.

2.       HMRC’s consultation, Tackling offshore tax evasion: Strengthening civil deterrents, can be read in full, here.

3.       Association of Taxation Technicians

The Association is a charity and the leading professional body for those providing UK tax compliance services. Our primary charitable objective is to promote education and the study of tax administration and practice. One of our key aims is to provide an appropriate qualification for individuals who undertake tax compliance work. Drawing on our members' practical experience and knowledge, we contribute to consultations on the development of the UK tax system and seek to ensure that, for the general public, it is workable and as fair as possible. Our members are qualified by examination and practical experience. They commit to the highest standards of professional conduct and ensure that their tax knowledge is constantly kept up to date. Members may be found in private practice, commerce and industry, government and academia.

The Association has over 7,500 members and Fellows together with over 5,000 students. Members and Fellows use the practising title of 'Taxation Technician' or ‘Taxation Technician (Fellow)’ and the designatory letters 'ATT' and 'ATT (Fellow)' respectively.