British taxpayers who have been hiding money and assets in offshore accounts are being urged to come clean and use a disclosure facility before the taxman comes knocking.
The warning comes from HM Revenue and Customs (HMRC) who say that anyone who’s been hiding investment and assets in Guernsey, Jersey or the Isle of Man will face having to pay tax and interest as well as the penalties due on the outstanding amount.
To help this, tax evaders have been given until September 30, 2016 to make a full disclosure of their assets and investments.
After this date, all banks and financial institutions in Crown Dependencies will hand over account holder details automatically under new ground-breaking agreements designed to tackle offshore tax evasion.
Anyone refusing to comply is running the risk of criminal prosecution, much higher penalties and the potential problems of having their names published.
David Gauke, the Exchequer Secretary, said: “The net is closing in on those who hide their assets offshore to evade their tax responsibilities.
“We are determined to tackle those tax evaders who choose not to pay what they owe.”
He added that more money is being provided for the HMRC to tackle offshore tax evasion and that they were already seeing impressive results.
The agreements signed between the UK and the dependencies are part of the growing trend around the world to tackle the secrecy of offshore tax havens.
The most notable is the US law to force banks and foreign institutions to reveal details of its American clients and it now looks increasingly likely that the European Union will also enact a law to clamp down on tax havens.
France is the latest country to announce that it too is planning to aggressively clamp down on offshore tax havens.
The moves to lift the veil of secrecy on offshore accounts have been controversial but the Isle of Man signed its deal in February followed by Jersey and Guernsey in March.
HMRC is keen for people to settle their tax affairs voluntarily before evaders are targeted in a wide-ranging campaign.
To underline their commitment, HMRC is stressing that they will have access to a range of data and information to help track down those it believes may be trying to mitigate their tax liabilities by moving their money and assets offshore.
Those who don’t make use of the disclosure facilities will be faced the prospect of a criminal investigation, they say.
The government believes that more than £1 billion in unpaid tax will be brought in to the government coffers over the next five years.
More information about HMRC’s offshore disclosure facility can be found at www.hmrc.gov.uk/offshoredisclosure