Taxpayers with cash, property and investments overseas are approaching their last chance to bring their tax affairs up to date.
Any taxpayer who has failed to declare income from overseas assets has to September 30, 2018, to put matters straight with HM Revenue & Customs under the ‘requirement to correct’ rules (RTC).
Telling HMRC before September 39 lets taxpayers qualify for reduced penalties, while from October 1, they start at 100% of tax owed plus interest and charges – and, warns HMRC, can soar to much more.
“With the deadline on the horizon, we urge you to check now if you need to make a correction under the RTC rules and, if so, come forward in plenty of time,” said a spokesman.
Special deal rules expiring
RTC has no minimum cut-off value, so all taxpayers with unpaid offshore tax need to make a disclosure.
“This means that taxpayers who have simply rented out a holiday home in another country and failed to declare the income should check their position. In addition, those who have moved to the UK from abroad but who have assets or income, perhaps from family holdings or businesses, in their country of origin may need to make sure that they have properly declared their tax position,” said the spokesman.
RTC applies to income tax, capital gains tax and inheritance tax.
Some companies that pay income tax as non-resident landlords must ensure they have paid the correct tax and, if necessary, make a disclosure.
Trustees, settlors and beneficiaries of trusts with overseas interests may also need to check whether they have unpaid UK tax liabilities.
Further information about RTC from HMRC is online
Foreign Service Relief scrapped for many
HMRC is warning Foreign Service Relief on termination payments is stopping for UK residents.
Employees who leave their jobs after April 5, 2018 receiving a payment or benefit will not qualify for tax for any foreign service if they are UK resident for the tax year in which their employment is terminated.
This change is subject to Parliamentary approval.
Meanwhile, HMRC is expects an extra £100 million revenue from tax inquiries related to the Panama Papers leak.
HMRC has revealed 66 wealthy taxpayers are under investigation for evasion because of stolen offshore financial data published by the media.
