HMRC have issued a further round of so-called ‘nudge’ letters, targeting
individuals that they believe may have undeclared offshore income or gains.
HMRC gets it information from international exchange agreements with other
counties and targets those individuals that they believe have undeclared income
from overseas.
If you have received any income from offshore pensions, bank accounts,
property, investments, etc, you should consider making a disclosure of the
source to HMRC, if you have not already done so in your annual tax returns.
You should ensure that the income is fully and correctly declared in your UK tax
return, even if tax is deducted from that income in another country and there is
no more tax to pay in the UK.
The letters being sent out state that HMRC believes that the individual has not
declared income from overseas and that they should correct that deficiency
now.
HMRC does not give any details of the information held and it is up to the
individual to then make a full and proper disclosure of the income and explain
why it has not been notified to HMRC in the past.
If you have received any income from overseas and not declared it to HMRC,
now is the time to do so, before HMRC asks the awkward question. It is always
better to make a voluntary disclosure before any letters are received from
HMRC.
There are penalties for non-disclosure. These are reduced where the error is
disclosed to HMRC voluntarily and not through being prompted in a letter from
HMRC. Where no disclosure is made to HMRC, the tax authorities can make an
accusation that the income has been deliberately concealed. The penalties for
offshore tax evasion can be as much as 200% of the tax payable.
If you would like to discuss this with one of our team, or if you have had
overseas income and you would now like to declare it to HMRC voluntarily,
we’d be happy to help and advise you and submit any disclosure to HMRC on
your behalf.
If you would like any more information about this or any tax issue please contact one of our tax team on 0141-332-6331.
You can also browse our other blogs on our website: https://russell-russell.co.uk/blogs/
Take care until the next time
Russell + Russell
