Tax Evasion

doo-daa

My friend's dad has just been told that his bank (offshore) has disclosed all his account details to HMRC, and that they are going to investigate him. He has worked abroad since 1992, and hasnt paid any tax (in Britain anyway) from that date. What sort of punishment/fines/interest is he looking at if he was earning say £30k in 1992 and is now on £40k? (just estimates as I dont know what he is on)

I have done some rough head-calcs without interest and it comes out at around £100k? (15 years = 180 months @ roughly £500-600 he should have being paying in tax per month = £90-108k).

Anyone else shed some light on this for me? Thanks.

nikki1520

It depends on a whole bunch of things really, and it's quite hard to give a proper answer without knowing all the ins and outs.

For example, was he paying tax in the country he was working? If so, and they have a reciprocal agreement with the UK, then he should have paid all the relevant tax, except on the interest he has recieved on his bank account.

It also depends where he is classed as domiciled - this may depend on things like how long he has been away, how much time he spends in the UK each year, where his main home is, whether he owns property in the UK and a whole buch of other stuff.

I'm not an expert by any means, but my main advice would be DONT PANIC. I'm sure some of the fine minds on here will be able to help you out. He may also wish to discuss his situation with an accountant for some detailed advice

Ems!

Letters are cuurently being sent out to people with offshore accounts, whether or not there is a liability. he needs to work out whether he has any issues - and speak to his tax advisor asap - see the link below - there is a sort of "amnesty" where there will ber eeduced penalties, but you must notify HMRc of intention to disclose by 22/6. However, this should only be done if there is anything to disclose which is why it is important he gets advice.

Sounds like he is non resident anyway? And maybe thsi won't be an issue , but he should sort out either way!!

https://disclosures.hmrc.gov.uk/oaics/

Cook_County

From everything the OP has said in his various postings that the individual concerened did not break UK residence because he was not in full time employment abroad for periods including a complete UK tax year during his time in Angola & Libya. Consequently he has failed to declare taxable income and may be subject to criminal prosecution for tax evasion.

My suggestion is that he contacts a solicitor first thing.

PosterBoy77

Surely the first thing would be to speak to a Tax Advisor rather than a solicitor? There may be other things we do not know, and solicitors are not normally specialists in tax advice.

Cook_County

He would be reported directly to SOCA in either case, but a solicitior would give legal professional privilege which given the criminal nature of the offence here - clear evasion of substantial amounts of UK tax - may be helpful. The solicitor could instruct an accountant/CTA to deal with compliance matters.

Innys

Cook_County wrote: »

From everything the OP has said in his various postings that the individual concerened did not break UK residence because he was not in full time employment abroad for periods including a complete UK tax year during his time in Angola & Libya. Consequently he has failed to declare taxable income and may be subject to criminal prosecution for tax evasion.

My suggestion is that he contacts a solicitor first thing.

Erm...where has the OP said in his posting that his friend's father worked in Angola or Libya?

In addition, the OP has made one posting, not various postings.

Finally, what is SOCA and what does it have to do with this post?

Is this thread related to another one on this site? If not, where is Cook County getting his information from?

Cook_County

SOCA reports are automatically made by ALL accountants/lawyers/tax advisers under the Money Laundering Regulations where there is ANY suspicion of tax evasion:

http://www.soca.gov.uk/financialIntel/suspectActivity.html

You are correct that the OP has kindly made the same post but with ever so slightly differing wording on more than one open forum so increasing the chance of the police or tax authorities catching the tax evader...

nikki1520

And for anyone who doesn't know SOCA is the Serious Organised Crime Agency. It's made up of ex Customs fraud investigators, police, immigration and a couple of other bits and bobs

magic_pants

I'm sorry, I've never read as much cobblers in all my life! Tax evasion does NOT mean some shadowy agency such as SOCA would get involved. This is the preserve of HMRC Special Compliance Group unless it involved organised crime. De-frauding the taxman is dealt with by HMRC.

WHA

magic_pants wrote: »

I'm sorry, I've never read as much cobblers in all my life! Tax evasion does NOT mean some shadowy agency such as SOCA would get involved. This is the preserve of HMRC Special Compliance Group unless it involved organised crime. De-frauding the taxman is dealt with by HMRC.

It is to the SOCA that an accountant would report any contravention of Money Laundering or Proceeds of Crime legislation, of which tax evasion comes under. SOCA will then decide what action to take, if any, and may indeed pass on the details to HMRC. That is why SOCA are involved. All accountants and solicitors are legally obliged to make such reports to SOCA unless they come under "legal privilege". Cook County is quite correct.