Hardcore tax avoiders are facing their last stand as one of the last tax safe havens sends HM Revenue & Customs (HMRC) a list of countries where they have stashed their secret cash.
Swiss banks must supply the list by May 31 under a tax agreement between Britain and the Swiss government.
The list will give HMRC a list of account holders who recently shifted their money out of Switzerland to other tax shelters to avoid paying tax on their illicit savings and investments to Britain.
The list will show the top 10 countries where the money has gone.
“HMRC knows British taxpayers have tried to take their hidden money out of Switzerland and bury it deep under banking secrecy in other countries,” said tax industry experts Pinsent Mason.
List of tax havens
“But their ploy will have failed because HMRC will be told who has moved the cash and where to under the agreement.”
The agreement is part of a tax pact between Britain and Switzerland that started on January 1, 2013.
Under the treaty, Swiss banks agreed to pay a levy on the accounts of British taxpayers to account for any historic undeclared tax.
HMRC believes 80% of British taxpayers with Swiss bank accounts and investments deliberately tried to evade tax and that many have attempted to keep their financial secrets by moving the cash to other tax havens.
However, their choice of destinations has become limited since around 60 leading financial centres have signed up to the US Foreign Account Tax Compliance Act (FATCA) and other former tax havens have signed a similar deal with the UK.
Secret banking
Under these agreements, foreign governments have agreed to routinely swap financial information about bank accounts and investments held by the other’s taxpayers.
Panama, Switzerland and Singapore were popular tax havens until they signed up for FATCA.
British territories and Crown Dependencies also relied on banking secrecy to run large financial services industries, but the Isle of Man, Jersey, Guernsey, Gibraltar, Cayman Islands and the British Virgin Islands have signed the British version of FATCA.
“As a result, tax evaders have few places left to hide,” said a Pinsent Mason spokesman. “The list from Switzerland will allow tax authorities around the world to focus on those few countries offering secret banking.
“Our advice to anyone who has failed to declare taxable income is do it now; because the fines and penalties are cheaper than if the tax man comes looking for you.”
