It's time to declare offshore income, gains and assets to HMRC warns Robert Woolley of HPH, Chartered Accountants.
HMRC is urging UK taxpayers to come forward and declare any foreign income or profits on offshore assets before 30 September to avoid higher tax penalties.
New legislation called 'Requirement to Correct' requires UK taxpayers to notify HMRC about any offshore tax liabilities relating to UK income tax, capital gains tax, or inheritance tax.
You may not realise you have a requirement to declare your overseas financial interests. Under the rules, actions like renting out a property abroad, transferring income and assets from one country to another, or even renting out a UK property when living abroad, could mean taxpayers face a tax bill in the UK.
From 1 October more than 100 countries, including the UK, will be able to exchange data on financial accounts under the Common Reporting Standards (CRS). CRS data will significantly enhance HMRC's ability to detect offshore non-compliance and it is in taxpayers' interests to correct any non-compliance before that data is received or be faced with higher penalties.
The most common reasons for declaring offshore tax liabilities are in relation to foreign property, investment income and moving money into the UK from abroad. Over 17,000 people have already contacted HMRC to notify them about tax due from sources of foreign income, such as their holiday homes and overseas properties.
You can correct your tax liabilities by using HMRC's digital disclosure service as part of the Worldwide Disclosure Facility.
Once you have notified HMRC by 30 September of your intention to make a declaration, you will then have 90 days to make a full disclosure and pay any tax owed.
Our tax team here at HPH can assist you in making the necessary disclosure and tax calculation if these new rules apply to you; just give us a call.
The information contained within the above blog article is for general information purposes and may be time critical; it does not constitute professional advice. We accept no responsibility for any loss which may arise from reliance on the information contained in the blog article. Always seek professional advice before acting.