Welcoming the offshore tax amnesty extension |
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| Tax | |
| Written by Gary Howes | |
| Friday, 27 November 2009 | |
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Extension shows that HMRC is finally taking a common sense approach to making this amnesty work.
HM Revenue & Customs (HMRC) announced today that the registration deadline for the New Disclosure Opportunity (NDO) would be extended from 30 November to 4 January 2010. HMRC is expected to make good use of the next five weeks by writing to more individuals holding offshore accounts: to date it has only written directly to around 35,000 offshore account holders. Cassidy explains: “Most of the banks that HMRC has approached for account holder details have yet to supply them – there could be another 150,000 individuals for HMRC to contact. This is vital because, my experience shows, that only a personal letter from HMRC really motivates people to come clean on tax inequalities – the more people they can write to before 4 January, the more money the amnesty will collect." PFK Accountants say they have had more enquiries about the NDO in the few days since the first batch of HMRC letters arrived than in the whole period since the NDO started on 1 September – with every individual mentioning a letter from HMRC. HMRC’s use of amnesties to crack down on offshore accounts has followed a very similar path to the amnesties used by the IRS in the USA: the IRS also extended the deadline on its last amnesty in October this year. Cassidy also says that, “HMRC has clearly learned from the experiences of the IRS. If this trend carries on, its next move will be an announcement in the Pre-Budget Report that all UK taxpayers will have to declare details of their offshore accounts when filing future tax returns – just like the FBAR rules in the USA. This would stop individuals opening offshore accounts in future as it would be backed by swingeing penalties – perhaps as high as 70% of the cash – for those who don’t report their accounts. “Things are only going to get tougher for offshore account holders. Anyone who has not declared their offshore account should follow HMRC’s commonsense lead and use the NDO to get their tax affairs put right now while it is still relatively cheap to do so.”
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