unpaid tax on investments and savings

lostinrates

Someone has come to me for help, and I'm seeking advice for them. They invested an inheritance, jointly with a sibling, and forgot about it. Literally. The money was predominantly in capital bonds. The person has only remembered now because the sibling wants to regain their half of the investment. Because the first party had forgotten the investment they have not delcared any thing made on this. Obviously they need to ut this right ASAP but are terrified and threatening to damage themselves from fear of any repurcussion.

To whom do I go to to deal with the tax issue? Their tax office?

Rafter

Yes - tax office will be able to advise on undeclared investment earnings and any penalties.

Are you sure that any tax is due? capital bonds sounds potentially like national savings bonds which are tax free?

Main thing is not to panic, get all the paperwork together and then talk to the tax office. Their remit and attitude is now very different and their job is now to help you pay what you owe and not a penny more.

Good luck

R.

lostinrates

Rafter wrote: »

Yes - tax office will be able to advise on undeclared investment earnings and any penalties.

Are you sure that any tax is due? capital bonds sounds potentially like national savings bonds which are tax free?

Main thing is not to panic, get all the paperwork together and then talk to the tax office. Their remit and attitude is now very different and their job is now to help you pay what you owe and not a penny more.

Good luck

R.

Its very difficult to be sure at all! The person in question is quite hysterical with fear and very secretive. I believe capital bonds are subject to tax, sadly.

Person is so worried offering to give away all money to avoid being penalised or ''branded a criminal'' so not terribly rational nor calm! But at least they have asked someone for help now, even if I need help to help them!

dunstonh

I believe capital bonds are subject to tax, sadly.

there is no such thing generically as a capital bond. It could be a marketing name from a provider. With the term "bond" being so miss-ued nowadays, you need to check what type of bond it is.

Some bonds have tax deducted at source and others are deferred until a chargeable event (although have some tax taken at source).

You need to identify what type of bond it is.

lostinrates

dunstonh wrote: »

there is no such thing generically as a capital bond. It could be a marketing name from a provider. With the term "bond" being so mis-sued nowadays, you need to check what type of bond it is.

Some bonds have tax deducted at source and others are deferred until a chargeable event (although have some tax taken at source).

You need to identify what type of bond it is.

I had presumed this was the thing:
http://www.moneypage.com/Investments/Bonds/Capital_Bonds.html
but thank you for the warning. I plan to visit the person in question on Tuesday and go through this then hopefully it will be simpler and be clear how to proceed. Hopefully a calm and unterrified eye is all thats needed, otherwise I suppose i had better find them a good tax lawyer!:o

Mikeyorks

lostinrates wrote: »

I suppose i had better find them a good tax lawyer!

Not normally needed if it's inadvertent and you're making full disclosure. But do ensure, as Dunstonh implies, that there's actually something to disclose first!

If you do need to contact their tax office on their behalf ....... follow this guidance :

http://www.hmrc.gov.uk/dealingwith/dealing-with.htm

...... or some offices will (as they're probably unaware of the above!) ask you to complete the more formal declaration on form 64-8.