HMRC’s Specialist Investigation unit may be about to launch a fresh wave of attacks on UK citizens with bank accounts held with the Swiss branch of HSBC, according to a report by Jamie Dunkley in The Telegraph.

The taxman bought stolen data from a former employee of HSBC Switzerland.  So far they have written approximately 800 letters to clients of the bank based in the UK.  Each of these informs the account holder that they are under investigation for suspected serious tax fraud, and includes the issue of Code of Practice 9.

HMRC have been trawling through the full records that they obtained.  It is believed that they have the names and bank details of around 7,000 UK citizens, and are about to issue a further round of Cop 9 letters.

Specialist Investigations and COP 9
Specialist Investigations is the elite investigatory arm of HMRC.  Code of Practice 9 (Cases of Suspected Serious Fraud) is issued in cases where the taxman believes he will recover more than £500,000 in tax interest and penalties.  Taxpayers who do not fully cooperate, and fully disclose, under the terms of COP 9 frequently face criminal prosecution. Code of Practice 9 investigations are highly intrusive. Specialist investigations frequently use their information powers to approach 3rd parties such as banks and business suppliers and customers.

What does it mean for me?
Any UK citizen with a Swiss HSBC account should consider making a pre-emptive disclosure to HMRC. If they do this under the terms of the Liechtenstein Disclosure Facility (LDF) then they will be guaranteed non-prosecution, the tax collected will be restricted to a maximum of 12 years, and the penalty kept to a token 10%.  Anyone who delays in making a disclosure risks prosecution, or the issue of Code of Practice 9.  If COP 9 is issued, the individual is them debarred from taking part in the LDF and HMRC can go back 20 years, and claim penalties of up to 200% of the tax, as well as interest.

Worried about an offshore bank account?
Lynam Tax Enquiry Experts have substantial experience of the key issues.  We are helping many clients and their agents with the current tax amnesty.

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