Tax authorities across the world are targeting the wealthy and businesses shrouding their financial affairs in offshore havens after a huge amount of sensitive financial information was leaked by a whistle-blower.
The data reveals the names behind secret accounts in the Cayman Islands, British Virgin Islands, Cook Islands and Singapore.
In Britain alone, HM Revenue and Customs has already identified and opened investigations in to the finances of around 100 taxpayers and companies.
Another 200 British-based tax advisers face some difficult questions about participating in tax avoidance schemes from HMRC.
Chancellor George Osborne said: “We have a simple message – if you evade tax then we are coming after you.
Aimed at tax avoidance
“With the UK’s presidency this year of the G8, the Prime Minister David Cameron is making it a priority to lead international efforts to fight tax evasion and avoidance.
“We have invested hundreds of millions of pounds to fight tax evasion, in the UK and abroad, and access to this data is another weapon in HMRC’s arsenal.”
HMRC says that anyone who has used offshore structures now needs to seek professional advice urgently and review their tax arrangements to ensure they meet UK law.
To help people come forward, HMRC is encouraging voluntary compliance and those not using this opportunity are leaving themselves liable for prosecution and heavy financial penalties. They add that investigators are still working on identifying more people to investigate.
Jennie Granger, HMRC’s commissioner for enforcement and compliance, said that while many international offshore structures may not be illegal and may have been declared to HMRC, some were undoubtedly aimed at tax avoidance.
International investigation
“Tax avoidance, evasion and other serious offences are illegal and the use of international structures to hide income and assets illegally must stop,” she said.
The hunt for those using such structures to hide their financial affairs is international, with HMRC revealing that the data is shared with the US Internal Revenue Service and Australia’s taxation office.
The leaked data amounts to 400 gigabytes – which HMRC says it cannot comment upon – but Phil Berwick from law firm Pinsent Masons says this latest announcement will unnerve many people.
He added: “The news is a warning shot for accountants and tax advisers who establish offshore structures that HMRC is coming for them if they feel those advisers have overstepped the mark.”
