John Cassidy, partner at audit, tax and advisory firm Crowe Clark Whitehill, predicts Osborne’s Autumn Statement on 3 December will aim to build significantly on HMRC’s efforts in 2014 to find and tax previously undeclared offshore assets.
“I expect the chancellor to take this a step further in the Autumn Statement by confirming measures to combat the problem of tax lost offshore, including the introduction of a new ‘strict liability’ rule. This means anyone with taxable income arising offshore that has not been declared will be automatically deemed to have committed a criminal offence.”
Cassidy said this would be a very aggressive step, adding that “if income or gains arise offshore and are taxable, anyone who has not reported them to HMRC will be guilty without HMRC needing to prove intent”.
This rule would apply across the board, from serious and persistent tax evaders to older people who did not previously realise their assets are liable to taxation.
“All HMRC will have to demonstrate is that tax is due in relation to offshore assets,” he said.
Cassidy also expects Osborne to announce increased penalties or a surcharge added to existing offshore penalties “which can already be up to 200% of the tax found to be due”.
“This all adds up to a perfect storm for those with undeclared assets; huge amounts of new data for HMRC to work with, an automatic assumption of guilt and increased fines once the number crunching is complete.”
Earlier this month, HMRC’s action against tax avoiders was claimed to be “unacceptably slow” in a report published by the UK government’s Committee of Public Accounts.
