New Civil Punishments Planned

HMRC has announced a far-reaching consultation today which proposes to introduce tough new sanctions for offshore tax evaders.

In addition to plans to make the failure to disclose taxable offshore income a criminal offence, new tougher civil sanctions are being proposed, as previously mentioned in the 2013 Autumn Statement.

In the consultation document on new civil deterrents, HMRC is seeking responses to six questions in relation to extending the scope of penalties for offshore non-compliance.

These include whether the scope for the offshore penalties regime should be extended to Inheritance Tax. The Revenue is also asking whether the current 20 year time limit that it has for examining potential evasion should be removed.

The consultation, which follows the announcement last week that HMRC is introducing restrictions to its Liechtenstein Disclosure Facility, closes on 31st October 2014.

Further information can be viewed here

HMRC has published a parallel consultation, Tackling offshore tax evasion: A new criminal offence. HMRC has stated that the majority of cases will be investigated and settled through its civil regime.

Phil Berwick, Partner* and Head of Contentious Tax at national law firm Irwin Mitchell, said: