As you will be aware as of 6 April 2017 HMRC enacted the Requirement to Correct “(RTC)” legislation. The purpose of RTC required anybody with historic undeclared UK tax liabilities i.e. income tax, capital gains, and inheritance tax, to declare these on or before 30 September 2018, to ensure correct payments are made.
The due date for RTC coincides with the Common Reporting Standard (CRS), which will significantly enhance HMRC’s ability to detect offshore non-compliance. It is therefore imperative to declare historic tax liabilities before HMRC have access to this data.
Failure to disclose relevant UK income by the deadline will result in significant Failure to Correct (FTC) penalties. FTC penalties will incur a maximum penalty of 200% of the tax liability due. Should your tax liability per year exceed £25,000 there will be an additional penalty of 10% of the value of the assets. Furthermore, if HMRC obtain evidence that the undeclared tax liabilities were deliberate there will be an additional penalty of 50% on top of the 200% penalty for FTC. HMRC also intend to publish the details of any individuals that have deliberately tried to avoid paying UK liabilities.
Provided an intention to disclose was registered with HMRC’s Digital Disclosure Services (DDS) by the deadline an extension of 90 days was given to provide the information to HMRC without FTC penalties.
Should you have any historic UK tax related obligations that may be liable under the RTC and FTC legislation Bracken Rothwell Limited can assist by bringing all matters up to date and try and keep penalties to a minimum. Our costs are competitively priced and our friendly staff can assure you have a complete handle on your situation.