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HMRC warns returning expats over tax evasion
| Published: | 2 Nov at 6 PM |
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As well as being one of FATCA’s most important signatories, the UK taxman is now forcing tax havens and other overseas financial hubs to swap banking and investing information on expat accounts.
Hundreds of thousands of returning expats who are keeping money and assets offshore are expected to receive letters from the British tax authorities, as are expats considered to be taxpayers in the UK whilst on assignments overseas. The letters will explain that more than 100 overseas tax authorities are now swapping information with HMRC about expats’ local bank accounts as well as any investments controlled by British workers overseas.
All overseas financial institutions including banks, wealth and asset managers and insurers are now compelled to send expats’ private details to Her Majesty’s Customs and Excise.First in the firing line are favourite expat offshore financial institutions based in traditional tax havens such as the Isle of Man, the Channel Islands, the Caymans and the British Virgin Islands.
According to the taxman, the cull is expected to identify a minority of expats who are avoiding paying taxes due. Stiff financial penalties are to be imposed on those who are found to have been evading tax. Up to 200 times the amount found to be owed plus interest and unspecified other charges are to be the norm.
In addition, other fines and penalties based on the value of expats’ offshore assets can also be imposed and will be subject to tax investigations. In some cases, criminal procedures will be brought. Also in the net for scrutiny are payments by self-employed expats who make payment arrangements with companies offshore in order to avoid paying the correct national insurance and tax on their earnings.
Payroll tax avoidance is now illegal, and those involved will face court cases should they not come forward voluntarily. Expats wishing to come clean as regards previous misfiling are advised to get in touch with HMRC’s Worldwide Disclosure Facility, or ask their financial advisor or accountant to make contact. The facility will remain open until September 2018, when new, higher tax penalties will be introduced.
Hundreds of thousands of returning expats who are keeping money and assets offshore are expected to receive letters from the British tax authorities, as are expats considered to be taxpayers in the UK whilst on assignments overseas. The letters will explain that more than 100 overseas tax authorities are now swapping information with HMRC about expats’ local bank accounts as well as any investments controlled by British workers overseas.
All overseas financial institutions including banks, wealth and asset managers and insurers are now compelled to send expats’ private details to Her Majesty’s Customs and Excise.First in the firing line are favourite expat offshore financial institutions based in traditional tax havens such as the Isle of Man, the Channel Islands, the Caymans and the British Virgin Islands.
According to the taxman, the cull is expected to identify a minority of expats who are avoiding paying taxes due. Stiff financial penalties are to be imposed on those who are found to have been evading tax. Up to 200 times the amount found to be owed plus interest and unspecified other charges are to be the norm.
In addition, other fines and penalties based on the value of expats’ offshore assets can also be imposed and will be subject to tax investigations. In some cases, criminal procedures will be brought. Also in the net for scrutiny are payments by self-employed expats who make payment arrangements with companies offshore in order to avoid paying the correct national insurance and tax on their earnings.
Payroll tax avoidance is now illegal, and those involved will face court cases should they not come forward voluntarily. Expats wishing to come clean as regards previous misfiling are advised to get in touch with HMRC’s Worldwide Disclosure Facility, or ask their financial advisor or accountant to make contact. The facility will remain open until September 2018, when new, higher tax penalties will be introduced.
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