Budget reveals new 'offshore disclosure opportunity' which will ask tax evaders to confess - or face the consequences.
New plans by HM Revenue & Customs (HMRC) to tackle the problem of offshore tax evasion have been revealed.
According to the Budget Report, individuals or companies who have "deliberately understated more than £25,000 of tax" will be named and shamed on an HMRC blacklist. Individuals and small businesses who frequently default on payments over £5,000 will also be told to provide more information on their tax practices for up to five years.
HMRC will run a second "offshore disclosure opportunity" under which tax avoiders will be able to voluntarily admit their guilt and pay the amount due. This scheme, which will run until March 2010, follows a similar campaign in 2007 which managed to bring in £450 million in revenue from 45,000 tax avoiders.
Offshore tax avoidance has become more prominent in recent months, due in part to the US president Barack Obama pledging a crackdown on the issue. The UK government has taken a number of steps to tackle the problem, with Gordon Brown writing to Crown Dependencies and British offshore territories asking them to adhere to tighter tax rules.
HMRC has now signed agreements information-sharing agreements with the likes of Jersey, the Isle of Man and the British Virgin Islands, which will put the offshore accounts of UK residents under greater scrutiny.
