For­eign in­come fines threat

Costa Blanca News (North Edition) - - FRONT PAGE - By Dave Jones djones@cb­

Tax­pay­ers have a month to dis­close un­de­clared tax li­a­bil­i­ties on over­seas as­sets be­fore new leg­is­la­tion comes in

HM Rev­enue and Cus­toms (HMRC) is urg­ing UK tax­pay­ers to come for­ward and de­clare any for­eign in­come or prof­its on off­shore as­sets be­fore Septem­ber 30 to avoid hav­ing to pay high tax penal­ties.

New leg­is­la­tion called ‘Re­quire­ment to Cor­rect’ re­quires UK tax­pay­ers to no­tify HMRC about any off­shore tax li­a­bil­i­ties re­lat­ing to UK in­come tax, cap­i­tal gains tax, or in­her­i­tance tax.

Ac­cord­ing to fi­nan­cial sec­re­tary to the UK Trea­sury, Mel Stride MP some UK tax­pay­ers may not re­alise they have a re­quire­ment to de­clare their over­seas fi­nan­cial in­ter­ests.

Un­der the rules, ac­tions such as rent­ing out a prop­erty in Spain, trans­fer­ring in­come and as­sets from one coun­try to an­other, or rent­ing out a UK prop­erty when liv­ing abroad could mean tax­pay­ers face a tax bill in the UK, he noted.

HMRC is hold­ing a pub­lic meet­ing on the leg­is­la­tion in Ro­jales next week.

Mel Stride MP, said: “Since 2010 we have se­cured over £2.8bn for our vi­tal pub­lic ser­vices by tack­ling off­shore tax evaders, and we will con­tinue to re­lent­lessly crack down on those not play­ing by the rules.

“This new mea­sure will place higher penal­ties on those who do not con­tact HMRC and en­sure their off­shore tax li­a­bil­i­ties are cor­rect.

“I urge any­one af­fected to get in touch with HMRC now.”

He noted that from Oc­to­ber 1 more than 100 coun­tries, in­clud­ing the UK, will be able to ex­change data on fi­nan­cial ac­counts un­der the Com­mon Re­port­ing Stan­dard (CRS).

The MP claimed that CRS data ‘will sig­nif­i­cantly en­hance HMRC’s abil­ity to de­tect off­shore non-com­pli­ance’ and it is in tax­pay­ers’ in­ter­ests to cor­rect this be­fore the data is re­ceived.

“The most com­mon rea­sons for declar­ing off­shore tax are in re­la­tion to for­eign prop­erty, in­vest­ment in­come and mov­ing money into the UK from abroad,” he said.

“Over 17,000 peo­ple have al­ready con­tacted HMRC to no­tify the de­part­ment about tax due from sources of for­eign in­come, such as their hol­i­day homes and over­seas prop­er­ties.”

Cus­tomers can cor­rect their tax li­a­bil­i­ties by: us­ing HMRC’s dig­i­tal dis­clo­sure ser­vice as part of the World­wide Dis­clo­sure Fa­cil­ity or any other ser­vice pro­vided by HMRC as a means of cor­rect­ing tax non-com­pli­ance; telling an of­fi­cer of HMRC in the course of an en­quiry into a per­son’s af­fairs; or us­ing any other method agreed with HMRC.

Once a cus­tomer has no­ti­fied HMRC by Septem­ber 30 of their in­ten­tion to make a dec­la­ra­tion, they will then have 90 days to make the full dis­clo­sure and pay any tax owed.

“If tax­pay­ers are con­fi­dent that their tax af­fairs are in or­der, then they do not need to worry,” added Mr Stride.

If any­one is un­sure, HMRC rec­om­mends they seek ad­vice from a pro­fes­sional tax ad­viser or agent.

The stan­dard penalty is 200% of the tax not cor­rected, al­though this may be re­duced de­pend­ing on the tax­payer’s level of co-op­er­a­tion with HMRC.

Ro­jales coun­cil­lor Derek Monks noted: “These changes can af­fect peo­ple if they live abroad and pay tax out­side the UK, for ex­am­ple peo­ple who rent out their UK home whilst

UK tax­pay­ers have a month to dis­close un­de­clared tax li­a­bil­i­ties on over­seas as­sets be­fore ‘Re­quire­ment to Cor­rect’ leg­is­la­tion comes in

liv­ing in an­other coun­try or those who still have UK bank ac­counts or in­vest­ments.”

He in­vited peo­ple to at­tend the event in Ro­jales ‘to hear if it af­fects you’.

The Bri­tish con­sulate-spon­sored pre­sen­ta­tion will be held on Tues­day (Septem­ber 4) in the Capi­tol theatre at 11.00.

Mr Monks added: “The con­sul will be in at­ten­dance along with HMRC rep­re­sen­ta­tives from the UK and your ques­tions will be ad­dressed.”

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