200 accountants face probe

Posted on 18 Feb 2013
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Ian Johnson of Northampton chartered accountants Harris & Co writes that HMRC have confirmed it is working with the United States and Australian tax administrations (the IRS and ATO) on data which reveals extensive use of complex offshore structures to conceal assets by wealthy individuals and companies.

Experts are analysing over 400GB of data and early results show the use of companies and trusts in a number of territories including Singapore, the British Virgin Islands, the Cayman Islands, and the Cook Islands. The data also exposes information that may be shared with other tax administrations as part of the global fight against tax evasion.

HMRC has already identified over 100 people who benefit from such structures and a number of them had already been identified and are under investigation for offshore tax evasion. The department has also identified over 200 UK accountants, lawyers and other professionals who advise on setting up such structures, who will now be scrutinised.

Chancellor George Osborne said:

‘The message is simple: if you evade tax, we’re coming after you. The Government has invested hundreds of millions of pounds to fund the fight against tax evasion, both at home and abroad. This data is another weapon in HMRC’s arsenal.’

‘Ahead of the UK’s presidency of the G8 this year, the Prime Minister has made it a key priority to drive an international effort to increase transparency and clamp down on tax avoidance and evasion. By working with our international partners in this way, we are again demonstrating our commitment to this work.’

HMRC urged any UK residents who use these offshore structures to review their taxation arrangements, and seek advice if necessary, to ensure they are compliant with UK tax law. Voluntary compliance and early disclosure of tax irregularities are encouraged and failure to do so may result in a criminal prosecution or significant financial penalties and the possibility of their identity being published.

Jennie Granger, HMRC commissioner and director general for enforcement and compliance, said:

‘Working with the international tax community to pursue offshore evasion is another important step in closing the net on tax evasion. ’

‘There is nothing illegal about an international structure, especially in a globally integrated economy and these arrangements may be perfectly legitimate and may already have been declared to HMRC. However they may involve tax evasion, avoidance or other serious offences by taxpayers. What has to stop is using offshore structures to illegally hide assets and income.’

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