HM Revenue and Customs are to send letters out to UK residents and companies, with assets in Swiss bank accounts at HSBC’s Geneva branch, suspected of not declaring offshore assets to the Revenue…
Tax evasion information leaked to the Revenue last year, led HMRC to knowledge of over 6,000 UK companies and individuals holding banking investments and offshore accounts with the HSBC Swiss branch in Geneva.
Since receiving the stolen information from HSBC Geneva’s offices, HMRC tax investigations have begun into over 500 business and individual offshore accounts with the Swiss bank.
Many UK residents with accounts and investments offshore at HSBC Geneva have already come forward and declared their offshore assets to HMRC through the Revenue’s offered Liechtenstein Disclosure Facility (LDF).
HMRC’s LDF offers exclusive benefits to UK tax evaders who come forward and voluntarily disclose their offshore assets.
No Criminal Prosecution
Limited 10% tax penalty – rather than a possible 200%
Names and addresses will be kept private and out of the public domain
HMRC can only look at your tax affairs back to 1999 – rather than up to the last 20 years
For more information on HMRC’s Liechtenstein Disclosure Facility and how KinsellaTax can help, please click here.
HMRC are to send out letters to Swiss bank account holders with HSBC Geneva who are not yet under tax investigation but are yet to come forward and make a voluntary disclosure of their offshore assets to the Revenue.
Those receiving letters will be given a set time period – 30 days from receiving the letter – to come forward and make a voluntary disclosure to HMRC stating all of their tax liabilities.
If you receive a letter and decide not to take advantage of this opportunity, HMRC will launch a tax evasion investigation into your tax affairs which may even result in tax penalties or even criminal tax prosecution.
To handle the large amount of HSBC Geneva Swiss bank account holders and businesses that will be contacted to take part in the new crackdown on tax evasion, HMRC have set up a specialist unit – the Offshore Co-ordination Unit – which will come into working action November 2011.
David Guake, Exchequer Secretary to the Treasury said:
“The Government has shown its commitment to closing the tax gap by making an additional £917million available to HMRC to tackle evasion, avoidance and fraud.
“This will fund the new Offshore Co-ordination Unit, and its specialist teams, which will drive forward this work.”
HMRC are hoping to further tackle tax evasion by opening the new opportunity to individuals and companies holding offshore accounts and investments with HSBC’s Swiss bank in Geneva.
The Revenues further crackdown on tax evasion is in response to the signing of a tax agreement between the UK and Switzerland earlier this month.
Click here to read ‘Tax Evasion: HMRC cut deal with Swiss banks to get £billions back from UK tax evaders’
The tax agreement signed by the UK and Switzerland means as of 2013 that investment income – profit made through an investment vehicle – will be liable for ‘withholding tax’.
From 2013 the new withholding tax will incur costs of up to 48% on income from offshore bank accounts; amounts depending on whether the income has arisen from interest, dividends or capital gains.
Dave Hartnett, the Revenues’ Permanent Secretary for Tax, has said that the new opportunity is ‘not an amnesty’ and those coming forward to make a voluntary disclosure to HMRC through this vehicle will not be offered ‘special rates of penalty or interest’.
Instead, Hartnett has called HMRC’s new move on tax evasion as an ‘opportunity for those who have made errors in past returns to correct them’.
If you currently hold a Swiss bank account with HSBC in Geneva and you have not yet come forward to HMRC, KinsellaTax would advise that you make a full disclosure of your offshore assets to the Revenue.
Kevin Kinsella Jnr, of KinsellaTax, said:
“With the Liechtenstein Disclosure Opportunity still available until 31 March 2015, I wonder if HMRC’s new Offshore Co-ordination Unit is another tactic to drive UK holders of Swiss bank accounts towards the LDF, as the tax amnesty has not been as successful as the Revenue first hoped.
“If, as Dave Hartnett says that this is not a tax amnesty and those who come forward and make full disclosures to HMRC are not offered ‘special’ tax penalty rates. Then the LDF will offer greater benefits to those who are yet to declare their Swiss bank accounts with HSBC Geneva.
“The problem now with the LDF, as we were recently informed by a bank, is that the minimum deposit they now require is 1m Swiss Francs, about £700,000 GBP.
“The last account that we opened with them was with a deposit of £10,000. So there are some fall effects in the Swiss bank arrangement and LDF not beneficial to UK residents.”
Do you currently have offshore assets or a Swiss bank account with HSBC Geneva?
If yes, don’t wait for HMRC to find you first!