Offshore Disclosure Facility Announced

Leading Sheffield independent firm of Chartered Accountants Barber Harrison & Platt is advising people to take action following the HMRC’s recent announcement of what is probably its first and only ever “amnesty”.

On April 17th the HMRC announced an Offshore Disclosure Facility (OFD), a one-off opportunity for taxpayers to disclose interest from undeclared overseas bank accounts. The OFD follows the success of the Revenue in forcing several high street banks to provide account details of customers with overseas accounts.

The Revenue therefore now has a significant amount of information regarding foreign accounts from which it is clear that interest on a very large number has gone unreported on Tax Returns. Because of the volume of information and the Revenue’s inability to investigate them all due to lack of resources, this one-off “amnesty” is being offered to any taxpayer who voluntarily discloses any such account.

This OFD is open until 22 June 2007. It is not a true amnesty as the persons involved will have to pay the tax which should have been paid on the foreign income plus interest and a penalty (if the untaxed income is over £2500). However, under the facility, the penalty will be only 10% of the tax payable as compared to a possible 30 to 100% outside the “amnesty” period.

Taxpayers should also be aware that the HMRC has declared its intention to follow up all those with offshore bank accounts and undeclared tax liabilities who have decided not to make a disclosure. There is a facility to disclose on-line at www.hmrc.gov.uk/home.htm, but anyone intending to declare an account, would be well advised to proceed with professional advice. Anyone seeking advice is welcome to contact Elaine Butler on 0114 266 7171.