According to the report, HMRC is sending the letters to names on a list of high-net worth UK individuals who have accounts with HSBC’s Swiss operation. It obtained the list from “French authorities” who in turn obtained it from an HSBC employee who stole it, the British media organisation said in its report.
The HMRC letters are a type known as “Code of Practice 9” letters, and “advise the recipients that they are suspected of committing illegal tax evasion which may lead to a criminal conviction,” the BBC said.
HSBC is not accused of any wrongdoing, it added.
An HMRC spokesman on Sunday was unable to confirm details of the BBC story, but said that some "Code of Practice 9" letters had indeed been sent to some taxpayers with Swiss bank accounts, and added: "This is part of our drive against tax evasion. The days of hiding money offshore to evade tax are now over."
According to the HMRC website, Code of Practice 9 is reserved for cases in which "serious fraud" is suspected.
Major crackdown
The BBC report on the HMC letters to HSBC clients comes one week after a top official in Britain’s recently-elected coalition government told a Liberal Democrat conference in Liverpool that British authorities were about to launch a major crackdown on tax evasion and tax avoidance, with an aim of clawing back as much as £7bn more a year in additional tax revenue by 2015.
Separately, in a page one story in its weekend edition, the Financial Times reported that UK accountants are already beginning “to feel the brunt” of the government’s crackdown on Brtain’s highest earners, with the authorities “moving to close widely used schemes”.
It noted that the measures against avoidance announced at the Lib Dem conference by chief secretary to the Treasury, Danny Alexander, meant that the tax bills of 150,000 top earners who pay the new 50% tax rate will be scrutinised, “a big increase on the 5,000 wealthy individuals” currently examined by HMRC’s special “high net worth unit”.
Switzerland seeking new image
News of HMRC’s plans to go after HSBC clients with Swiss accounts will not be greeted with joy in Switzerland, which, although still disinclined to abolish its secrecy laws, is trying to reshape its business model under intense pressure from such countries as the US, Germany, the UK, Italy and France.
As reported in an examination of Switzerland’s changing approach to wealth management in the August issue of International Adviser, ever since the country’s agreement in June to allow UBS to divulge to US authorities the names of more than 4,400 of its clients suspected of tax evasion, it has become "almost impossible to find anyone in Swiss financial circles who will argue that their business has not had to change already to accommodate the new era of Swiss wealth management".
That said, though, if hundreds of UK taxpayers still have income in Swiss bank accounts that they have not reported to HMRC, as the BBC report suggests, it would seem many wealthy UK individuals have yet to get the message that the Swiss bank secrecy party may be coming to an end — and that HMRC is determined to get them if they have tax owing.
Such individuals will by now have ignored several HMRC tax "amnesty" programmes over the last few years, as well as the news last year that hundreds of UK banks and financial institutions had been ordered to hand over details of customers with offshore accounts.
As reported here in August 2009, it was understood at that time that "a number" of these were UK institutions with branches in Switzerland.
These account holders also would have ignored the news of UBS’s surrender of account names to the US earlier this year, and turned a deaf ear in March to reports about the theft of the Swiss bank details on which the latest batch of HMRC letters apparently is based.
According to those reports, a Swiss HSBC employee fled to France three years earlier with details of some 24,000, though only 15,000 were said at that point to still be active.
