Since 2010 HMRC has bought in more than £2b from offshore tax evaders and the Government has repeatedly strengthened HMRC’s powers and resources with new criminal offences and higher penalties, so tougher action can be taken by those that are perceived to have hidden their money in offshore tax havens. New measures include higher financial penalties (currently up to 300% of any tax found to have been hidden offshore), such as, for the first time, taking part of the evaded asset as a penalty and a potential new strict liability criminal offence for offshore evasion, meaning it would no possible to plead ignorance in an attempt to avoid criminal prosecution.
HMRC has a great deal of information on offshore companies, gathered from a wide range of sources and intelligence. For example, HMRC has approached the International Consortium of Investigative Journalists, the BBC and The Guardian to share its data, so HMRC can cross-reference it with ‘Connect’, HMRC’s sophisticated data interrogation system and database of intelligence, to see if it adds to the 700 current leads HMRC already have with a link to Panama. In addition, HMRC will automatically receive offshore account and trust data from more than 90 countries, including British Overseas Territories and Crown Dependencies with a financial centre.
HMRC is following up thousands of leads on potential offshore evasion at any one time. In April 2016, HMRC announced that its specialist offshore unit in its Fraud Investigation Service was currently investigating more than 1,100 cases of offshore evasion around the world, with more than 90 individuals subject to current criminal investigation.
In light of this and given HMRC has run a number of formal disclosure facilities in relation to offshore evasion, a voluntary disclosure to HMRC in respect of any offshore issue is the best way of protecting yourself from punitive action by HMRC. If you have undisclosed income, gains, assets or investments here in the UK or overseas, then you need protection.