- £400 million yield from 45,000 disclosures through the Offshore Disclosure Facility (ODF). A further £91 million has been raised from subsequent investigations
- £85 million yield from 5,500 disclosures through the New Disclosure Opportunity (NDO). A further £6 million has been raised from subsequent investigations
- 3,000 ongoing enquiries in relation to the NDO and ODF as HMRC steps up its attack on offshore evasion. This will be helped significantly by HMRC’s receipt of offshore bank account information, which has been received as a result of serving orders on financial institutions to provide details of UK persons with offshore accounts
- 10 criminal investigations
It is clear that HMRC intends to invest significant resources into non-compliance investigations relating to offshore assets in the years ahead. Any person who has an undisclosed offshore bank account or structure should take advice as a matter of priority.
Details of the Liechtenstein Disclosure Facility (LDF) are set out separately – please see our LDF web pages.
Task Forces and other campaigns
HMRC has announced ‘The Property Sales Campaign’ which is aimed at unpaid capital gains tax on the sale of property, particularly on the sale of second homes. This is a disclosure opportunity for those with undeclared gains on property located either in the UK or abroad.
This opportunity exists until 9 August 2013 with any unpaid tax due by 6 September 2013. Taxpayers who use this disclosure opportunity will receive lower penalties and better terms than those whom HMRC approach first.
HMRC give the examples of properties sold that were gifts and the sale of holiday homes, but this could apply to any second home.
It is noted that this campaign is aimed at property generally and is not limited to second homes, HMRC highlight ‘people need not be concerned about the sale of their main home (also known as their private residence) as this is usually exempt from capital gains tax. This exemption may not apply, however, when it has not been their only home or main residence throughout, or they have used it for business purposes, including letting the property, or they have sold part of the garden.’
Task forces to tackle tax evasion in specific sectors and locations will be part of HMRC’s crack down on tax evasion. This follows on from the government’s £900 million investment to tackle evasion and avoidance to recover £7 billion per annum from 2014/15.
HMRC will be running four national campaigns a year until 2015, each involving around 200,000 taxpayers. The campaigns will provide opportunities for people to voluntarily put their tax affairs in order and become compliant. HMRC has said that for those who choose to remain non-compliant it will follow-up with a range of actions, including prosecutions.
The campaigns for 2011/12 announced by HMRC targeted Restaurants in London, VAT defaulters, private tutors, e-marketplaces, plumbers and the medical profession (read more about the medical profession).
Six task forces launched by HMRC in May 2012 targeted:
- Indoor and outdoor markets in London
- Taxi firms in Yorkshire and East Midlands
- Property rentals in East Anglia, London, Yorkshire and the North East
- Restaurants in the Midlands
See the press release
The taskforces announced in November 2012 aim to recover about £17m and will focus on:
- the rental property sector in the south-east (excluding London), including people who are letting properties and not disclosing the income on their tax returns.
- the alcohol industry in Scotland, including shops and manufacturers.
- the clothing trade in the Midlands, North Wales and the north-west, including manufacturers, wholesalers, shops and textile recycling firms.
Taskforces are specialist teams that undertake intensive bursts of activity in specific high risk trade sectors and locations in the UK. The teams will visit traders to examine their records and carry out other investigations. Earlier this year it announced that 30 tax evasion taskforces would be launched in 2012-13.
New approach to avoidance schemes
HMRC is sending letters directly to 1,500 people who it believes have signed up to one particular avoidance scheme; which has not been named publically. The correspondence is believed to be the first of its kind and appears to be a pre-emptive strike strategy. A National Audit Office report said that HMRC was dealing with a backlog of 41,000 cases of aggressive tax avoidance involving individuals and small companies.
HMRC is sending out four versions of the same letter in the pilot scheme, one of which states: "You are in the small minority of people who have made the deliberate choice to avoid tax. We focus our resources on this small minority. The choice that you have made changes the way we view your tax affairs. Our specialist investigations unit will be carrying out a full investigation into this scheme and they will open an enquiry into your tax affairs."
Another extract from the letters stated: “We are committed to challenging aggressive tax avoidance, and we will do so through the courts where appropriate. If we do this then it will lead to years of uncertainty about your tax affairs, and mean considerable additional cost to you. We are already challenging similar schemes and we have a very successful track record in the courts with schemes of this type. Your decision to use a scheme such as this means that we will treat you as a higher risk customer. Therefore we will monitor more closely your tax affairs."