HMRC discussion document on helping taxpayers get offshore tax right – Law Society response

The proposals

We responded to an HM Revenue and Customs (HMRC) consultation seeking views on ways to help taxpayers get their offshore tax right first time.

This discussion document focuses on how HMRC could:

  • use data in different ways to help taxpayers get their offshore tax right
  • better support taxpayers with their offshore tax obligations
  • work with agents and intermediaries to help promote offshore tax compliance amongst taxpayers

Offshore tax in this context is UK tax that is due on non-UK income, gains (such as proceeds from the disposal of offshore rental property) or transfers.

Our view

Our response provides feedback and ideas for ways in which HMRC might collect and use data and carry out their communications and compliance work effectively in order to support taxpayers in relation to their offshore tax obligations.

Among our comments:

  • we consider that appropriate prompts for taxpayers, including on tax returns themselves, could be helpful
  • invitations could be provided to prompted taxpayers to contact HMRC along with links to relevant information
  • in considering whether more information about sources of income, amounts and payment dates should be required of taxpayers, consideration should be given to minimising any consequent additional compliance burden (for example, by including a de minimis threshold)
  • an awareness campaign may be a good idea in the context of offshore tax, as well as dedicated information tailored to common scenarios

What this means for solicitors

Solicitors who advise taxpayers on offshore tax may be affected if ideas explored in the discussion document are progressed which include, for example, an idea for HMRC to inform advisers of information HMRC has about a taxpayer’s offshore assets.

Next steps

The consultation closed on 15 June 2021.

HMRC will review the responses to this consultation and may then carry out formal consultation on measures that are identified.

Read the discussion document on the GOV.UK website

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