HM Revenue & Customs (HMRC) have today finally confirmed the launch of the 2nd Tax Amnesty (the New Disclosure Opportunity initiative) that allows UK taxpayers with unpaid taxes linked to offshore accounts or assets to settle their tax liabilities at a favourable penalty rate.
HMRC’s press release says: “under the New Disclosure Opportunity (NDO) people who make a complete and accurate disclosure between 1 September 2009 and 12 March 2010 will qualify for a 10% penalty.” HMRC’s Chief Inspector of Taxes, Dave Hartnett, said: “This will be the last opportunity of its kind.”
How to use the NDO
To use the NDO a “Notification of Intention to Disclose” must be made to HMRC between 1 September and 30 November 2009. Hard copy (paper) notifications can be registered 1 September to 30 November. Electronic notifications can be registered 1 October to 30 November.
Following a “Notification” Full Disclosures have to be made: on paper, 1 September 2009 to 31 January 2010; electronically, 1 October 2009 to 12 March 2010.
A penalty rate of 10% (of the previously undeclared tax) will apply to those who were not written to by HMRC under the ODF in 2007.
Anyone who HMRC wrote to in 2007 offering the 10% rate but who did not complete the 1st Tax Amnesty: the Offshore Disclosure Facility (ODF) procedure (April to November 2007) and now want to disclose under the NDO can do so with the unpaid tax incurring a penalty of 20%. This is a welcome clarification from the taxman who had previously said that the 20% rate would apply to people who were “aware” of the ODF. The ODF ran from April to November 2007.
The taxman also said: “Once this disclosure window closes on 12 March 2010, those taxpayers who have not come forward but are found to have unpaid tax liabilities will face tax geared penalties of at least 30% rising to 100% of the tax evaded. They also run a risk of criminal prosecution”.
What does this mean for me?
If you have any undeclared tax liabilities and also an offshore bank account or any offshore property then you can use the NDO. If you have very straightforward tax affairs you may be able to handle the disclosure yourself or with the help of your usual general practitioner accountant. If your tax affairs are more complicated (e.g. you have several sources of income, or your offshore accounts are more than 6 years old, or you are a UK trader who has undeclared trading income, or your domicile or residence status is unclear, or you are an executor of an estate that did not declare the offshore asset/ bank account for IHT purposes, or you are currently subject to a tax enquiry or investigation) then you may need specialist help.
If you are concerned about an offshore bank account or offshore assets, or have any historic tax liabilities that are worrying you, or think the New Disclosure Opportunity may benefit you: then Lynam Tax Enquiry Experts can help. Call today for a confidential, discreet discussion with our experienced Tax Dispute Specialists.
Call Paul Lynam now on 0845 643 9997