Tax Investigations

HM Revenue & Customs (HMRC) over the past few years have run a number of disclosure campaigns providing tax payers with an opportunity to come forward and disclose undisclosed income or gains. The first of these facilities focused on offshore income whilst of late HMRC have looked closer to home and targeted specific industries.

The disclosure opportunities offer more favourable terms than making a normal disclosure and also provide some certainty over the level of penalties that will be imposed.

Current HMRC Campaigns

HMRC have a number of campaigns running:

HMRC Launches Property Sales Campaign

This latest initiative is aimed at those that have made gains on second homes and rental properties and have not reported them to HMRC.

The campaign applies to individuals only. Trusts, companies and partnerships that have undisclosed gains on residential properties will not be able to take advantage of the disclosure facility.

Individuals have until 9 August 2013 to notify HMRC of their intention to make a disclosure and a full disclosure must be made by 9 September 2013.

The advantage of making a disclosure under the campaigns is that you will be charged a lower rate of penalty, as you will be treated as making an unprompted disclosure, and you will have some certainty regarding the penalty charged.

HMRC have indicated that they have collated information on second home disposals from a variety of sources including SDLT returns, the land registry, estate agents, solicitors and banks. After the campaign deadline has passed they will be using this information to identify those that have not taken advantage of the disclosure facility. In these cases penalties will be much higher and HMRC are likely to take a far greater interest in the individual’s affairs.

Please contact Stuart Shaw on 01622 758257 or at if you would like to discuss the campaign in more detail.

Liechtenstein Disclosure facility (LDF)

For those that qualify; the Liechtenstein Disclosure facility is available until 31 March 2015. The LDF offers some very favourable terms and it may be possible to make a disclosure under this facility even if you do not have any undisclosed income in Liechtenstein.

HMRC have indicated that for those that did not take advantage of the earlier initiatives will face harsher treatment, in the event of discovery, from HMRC with significantly increased penalties.

For those with undisclosed foreign income an extra incentive, to make a full disclosure, is the new penalty regime for failure to disclose offshore income. Currently, the maximum penalty that HMRC can issue is 100% of the tax due on undisclosed income. From 6 April 2011 the maximum penalty will be 200% for income arising in territories where UK has no exchange of information agreement and 150% for those territories where an exchange of information is not automatic but available on request.

We have assisted many clients to select the most appropriate disclosure opportunity, helped calculate the extent of the problem and prepared the disclosure on their behalf.

We understand that this can be a worrying and stressful time and will ensure that the process is managed in an efficient and professional manner.

For a Free, Confidential No Obligation consultation contact Stuart Shaw on 01622 758257 or via email

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