UK New Disclosure Opportunity to End March 2010

July 10, 2009 Offshore BankingTax HavensTaxation in UK  No comments

The HM Revenue & Customs (HMRC) has begun a New Disclosure Opportunity (NDO) initiative to run through until 2010, in the hopes of reclaiming any taxes owed by offshore bank account holders.

New Disclosure Opportunity notifications will be sent out to the clients of numerous UK banks and financial institutions by the HMRC in a scheme to entice offshore account holders into disclosing any unpaid tax obligations. In July 2007 a similar Offshore Disclosure Facility (ODF) was run by the HMRC and netted over £450 million in previously unpaid taxes.

Clients of Barclays, Lloyds, HSBC, HBOS or RBS, who received notification from the previous ODF, will face a penalty of 20% of their tax liability. Offshore account holders who did not receive opportunity to disclose during the NDO will only face a 10%. Individuals who ignore this NDO are likely to receive even higher penalties, although these are yet to be announced by the HMRC. The NDO has been announced as the last opportunity to be provided for offshore account holders to declare their unpaid tax debts without prosecution. Full repayment of tax liability will be required, along with a penalty.

In order to make use of the NDO, notification must be received from the individual’s financial institution. Currently deadlines for the NDO have been set at January 31st, 2009, for those wishing to disclose on paper, and March 12th 2010 for those disclosing electronically.

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