Anton Lane examines the implications and subtleties of HMRC’s drive to help ‘taxpayers get offshore right’.
Lurking behind the consultation ‘Helping taxpayers get offshore tax right’ is a mechanism to systematically target and penalise those that don’t, including professional advisers. It’s a must-read for those with offshore assets, advisers with client’s holding offshore assets or those advising on offshore matters.
HMRC published a discussion document on 23 March 2021 entitled ‘Helping taxpayers get offshore tax right’ (the closing date for comments was 15 June 2021). The proposals in that document indicate the ability HMRC have to identify those with offshore assets and to proactively encourage tax compliance.
Having offshore assets, income or gains is not naughty but it can be. The tax problems with ‘offshore’ that have arisen over decades include (but are not limited to):
- Misunderstanding of the UK tax treatment.
- Wrong understanding of domicile or the tax treatment of a non-UK domiciliary.
- Not appreciating the transfer of assets abroad legislation and when it applies especially when there are associated operations.
- Believing there is an available commercial exemption from anti-avoidance legislation.
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