There have been a number of well publicised initiatives in respect of the identification of undisclosed offshore income and assets. This started with the sensationalised acquisition of stolen data from offshore banks thereby providing evidence to HMRC that these were being used for wide spread evasion of tax.
This linked with international pressure on “tax havens” to be more open has led to HMRC focusing on taxpayers who they believe or know have assets or income offshore.
Currently the main source of information is that obtained from banks usually through information obtained through other sources such as disgruntled employees. However HMRC have recently concluded an agreement with Switzerland which means that investors will be subject to “withholding tax” and also grants greater access of HMRC to Swiss banking records. The right of access is also designed to increase as more tax evasion is identified. It is therefore likely that with time more account details will be provided to HMRC.
If you are in the position where you believe that there may have been a non-disclosure then the matter should be remedied as quickly as possible. HMRC will look at the question of interest and penalties on non-disclosed tax but there are ways to limit exposure through general disclosure and also use of the Lichtenstein disclosure facility. Early disclosure is definitely the best course and where HMRC identify the issue themselves they take a very serious line. A number of criminal prosecutions are already underway.
