May 2009

ACCOUNTANTS WARN OF NEW FOCUS ON OFFSHORE ACCOUNTS

Auker Rhodes Chartered Accountants are warning taxpayers to take steps now to ensure their affairs are in order before the government launches a second crackdown on the holders of offshore accounts.

No date has yet been set for the crackdown to begin but it will take place during 2009. The government is hoping it will repeat the success of its first initiative, which netted £400 million in tax that would otherwise have gone unpaid.

Offshore accounts first came under scrutiny in April 2007 when account holders were given until November of that year to disclose and pay outstanding tax and any other undeclared liabilities going back 20 years.

To encourage account holders to make voluntary disclosures, HM Revenue & Customs (HMRC) limited penalties for those who admitted owing tax to ten per cent of the outstanding bill. Tax experts believe HMRC will be seeking much higher penalties during its second initiative.

It has been reported that HMRC will be contacting 300 banks and building societies requesting names and addresses of UK resident customers with offshore accounts as part of the 2009 crackdown.

Ian Hales from Auker Rhodes said: “Anyone who thinks that they might be affected by this new phase of HMRC’s enquiries would be wise to seek expert tax advice on how best to proceed. It would certainly make sound sense to make a voluntary disclosure before HMRC comes calling.”

The author is a director in Auker Rhodes Chartered Accountants of Bradford, members of UK200Group with offices throughout the UK and Associates overseas.

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