Disclosing your worldwide assets
No matter where your money and assets are, if you are resident and domiciled in the UK, you must pay UK tax on all your income and gains worldwide. There are certain advantages if you are not domiciled in the UK but there are still complex and ever-changing rules to be followed.
HMRC's experience over many years led it to recognise that often funds kept overseas were not declared for UK tax purposes. It also identified that most of the serious tax evaders it dealt with held some funds outside the UK – so, in its eyes, individuals who have so-called ‘offshore assets’ are a high risk. It is now addressing this risk on a systematic basis and seeking to collect all tax arrears.
HMRC has specific agreements and information gathering protocols with most major countries and with most of the former 'tax havens' commonly used by UK residents.
In conjunction with the G20, the OECD has developed a Common Reporting Standard (CRS) for the automatic global exchange of financial information. Nearly 60 early signatory countries will begin exchanging information in September 2017 with many more to follow later. Existing participants include most of the well-known former ‘tax havens’. The CRS ‘looks through’ any trusts, companies and foundations to identify the individuals who have an interest. The information will then be given to the country where those individuals are believed to be tax resident.
If you have any overseas income or capital gains that were overlooked on your UK tax returns, now is the time to put matters right. If you wait until HMRC begins an investigation, the eventual settlement cost will be higher.
Contact us for confidential, no obligation advice.