What will HMRC receive?
HMRC will receive “tax information” about UK taxpayers with accounts in participating jurisdictions. The information is that relating to a “financial account”.
The model provides for the following to be provided:
Taxpayer identification number
Date and place of birth
Account balance or value
Cash value or surrender value
Gross amount of interest, dividends or income
Gross proceeds from disposal
It’s enough to make Specialist Investigation’s task easy, especially when that information is likely to feed directly into Connect – HMRC’s award winning software that collates information, identifies connections and tax irregularities at speed.
The model to be adopted intends to limit the opportunities for taxpayers to circumvent the model by shifting assets to institutions or investing in products not covered by the model. It covers different types of investment income including interest, dividends and similar types of income and also addresses situations where people seek to hide capital that itself represents income or assets on which tax has been evaded.
The reporting not only on individuals but will require institutions to look through shell companies, trusts or similar arrangements. The reporting regime covers not only banks but also financial institutions, brokers, collective investment vehicles and insurance companies.
It may be prudent for those with offshore interest to consider appointing a specialist to review their affairs to ensure they are compliant or to make a disclosure.
The advantages of making a disclosure include:
Avoid criminal prosecution
Peace of mind
You get to present your case
You can agree the scope of disclosure
A disclosure should result in reduced interest and penalties
Avoid civil investigation of fraud