Anyone with undeclared UK tax liabilities from offshore interests must settle their affairs before 30th September 2018 or they could face large penalties. The warning comes from a professional tax body.
Under the “Requirement To Correct” (RTC), anyone who does not have a perfect UK tax position as a result of offshore assets from April 2017 has around 17 months to get their affairs in order, said the Association of Taxation Technicians (ATT).
The ATT said: “Failure to correct the position by the end of September 2018 will result in penalties of up to 200 per cent of the tax at stake. HMRC will also have the power to publicly name and shame affected taxpayers in certain circumstances.”
Such circumstances would be reserved for heavy and persistent offenders (with, for example, a tax loss of more than £25,000). However, HMRC is hardening its stance.
An example of this is that under the RTC, any taxpayer who has been careless or does not have a reasonable excuse could face a minimum 100 per cent penalty even if they have been cooperating with HMRC.
The ATT’s Yvette Nunn said: “HMRC’s previous offering was seen as the ‘carrot’ of incentives for those who came forward and brought their tax affairs into order. The RTC represents a change in approach, threatening taxpayers with the ‘stick’ of large penalties.”
The RTC was removed from the Finance Act 2017, but it has now been reintroduced. The RTC lists non-compliant behaviours such as failure to notify change in income tax or capital gains tax or submitting an inaccurate return for income tax, inheritance tax or capital gains tax where they relate to assets, income or activities transferred or located overseas.