A crucial deadline for UK taxpayers with foreign assets is looming – with the potential for serious penalties to be imposed for non-compliance.
HM Revenue and Customs (HMRC) is demanding people declare any foreign income or profits on offshore assets before September 30th as part of the new ‘Requirement to Correct’ legislation.
The legislation requires taxpayers in the UK to notify HMRC about any offshore tax liabilities relating to UK income tax, capital gains tax, or inheritance tax prior to the end of September. As of October 1st, the organisation’s ability to detect non-compliance will massively increase.
This is thanks to HMRC being able to exchange data on financial accounts with more than 100 countries under the new Common Reporting Standard (CRS).
Taking all of this into account, it is in the taxpayers’ best interests to notify HMRC of any undeclared overseas income and gains by September 30th.
Burgis & Bullock’s head of private client tax, Rosy Hughes, said: “It is crucial for anyone with foreign assets that they get their affairs in order before the deadline.
“HMRC has said it will be cracking down ‘relentlessly’ on those who aren’t playing by the rules and over 17,000 people have already contacted them to make sure they are up to date.
“We can assist with the entire process and even if people think that everything is in order, it is better to be safe than sorry.
“CRS data will significantly enhance HMRC’s ability to detect offshore non-compliance and it is in taxpayers’ interests to correct any non-compliance before that data is received.
“Under the rules, actions like renting out a property abroad and receiving investment income or gains from offshore investments could lead to enhanced penalties if not declared before the deadline.
“If any of these apply to you it is crucial that you get advice while there is still time.”
Since 2010, more than £2.8 billion has been secured by the HMRC through tackling offshore tax evaders.
If you have any issues that are declared to HMRC before the deadline, you will have 90 days to make the full disclosure and pay any tax owed.