Out-Law News 1 min. read

Swiss bank account holders pursued in Revenue crackdown


 UK residents and organisations holding Swiss bank accounts with the HSBC in Geneva will have a "window of opportunity" to disclose their tax liabilities before HM Revenue and Customs (HMRC) begins its own investigations, HMRC has announced.

6,000 individuals, companies, trusts and other bodies hold accounts and investments with HSBC Geneva, according to information received by HMRC under a tax treaty last year. The department has already begun criminal and serious fraud investigations into more than 500 account holders, it said.

HMRC said its new Offshore Coordination Unit will shortly begin writing to account holders who are not currently under investigation or who are yet to come forward under its Liechtenstein Disclosure Facility (LDF), allowing those with unpaid tax linked to assets in Liechtenstein under a special arrangement, offering them the opportunity to disclose all their tax liabilities.

If they do not come forward HMRC will begin its own investigation into their affairs which could include a criminal investigation or result in penalties of up to 200%, it said.

David Gauke, Exchequer Secretary to the Treasury, said the move was one of several new measures to tackle the 'tax gap' between what should in theory be collected and the amount of tax that is actually collected. The Government has made an additional £917 million available to the department to fund the Offshore Coordination Unit and tackle evasion, avoidance and fraud, he said.

Earlier this month the Government formally ratified an agreement with Switzerland that it claims will raise "billions of pounds" for the UK from 2013.

Under the terms of the agreement, all existing accounts held by UK taxpayers in Switzerland will be subject to a one-off deduction of between 19% and 34% to "settle past tax liabilities". Swiss banks will also make an up-front payment of 500 million Swiss francs to the UK as a "gesture of good faith".

From 2013, a new withholding tax of 48% on investment income and 27% on gains will be applied to UK residents with funds in Swiss bank accounts. A new information-sharing provision will also make it easier for HMRC to find out about offshore accounts held by UK taxpayers.

Neither provision will apply if the account holder authorises a full disclosure of their information to HMRC by the Swiss bank. HMRC will then seek any unpaid taxes with relevant interest and penalties where appropriate.

Dave Hartnett at HMRC said the letters were not part of a "tax amnesty".

"There are no special rates of penalty or interest for those who come forward voluntarily. This is an opportunity for those who have made errors in past returns to correct them," he said.

 

 

 

We are processing your request. \n Thank you for your patience. An error occurred. This could be due to inactivity on the page - please try again.