HMRC eyes £3 billion from UK tax dodgers - Money - News - Moneyfacts

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HMRC eyes £3 billion from UK tax dodgers

HMRC eyes £3 billion from UK tax dodgers

Category: Money

Updated: 12/06/2012
First Published: 12/06/2012

MONEYFACTS ARCHIVE
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HM Revenue & Customs (HMRC) is looking to recoup £3 billion from tax dodgers looking to hide their funds in Liechtenstein .

Under the new disclosure agreement between the UK and Liechtenstein , more than 2,400 people have registered to disclose unpaid tax bills, with £363 million already handed over.

And HMRC now expects the Liechtenstein Disclosure Facility (LDF) to bring in up to £3 billion by 2016 based on the current numbers of disclosures – far more than was originally expected.

"The third Joint Declaration recognises the overwhelming success of the LDF," said Dave Hartnett, Permanent Secretary for Tax at HMRC.

"HMRC originally estimated the number of people who would register for the disclosure facility at 2,000, and that it would probably produce £1 billion.

"In light of the ongoing success of the LDF we now anticipate the arrangements will produce up to £3 billion from a much larger number of people."

Those coming forward to pay their tax will have to pay a penalty of 10% of the tax they owe, as well as tax and interest on their money going back a decade.

But those who do not come forward face having to pay far heftier penalties if they are found to be hiding funds in Liechtenstein .

The territory has long been popular with UK tax dodgers, with thousands of Britons thought to be hiding money in the country.

The new prediction for tax receipts came as the two countries announced a double taxation agreement, which will ensure people are paying the correct rate of tax, but are not charged in both the UK and Liechtenstein .

"The UK has the largest tax treaty network in the world but, until now, Liechtenstein was the only country in the European Economic Area we had no agreement with," said David Gauke, Exchequer Secretary.

"This new treaty and the existing disclosure facility show that the net is closing on those who try to evade their UK tax liabilities by using offshore structures - there are fewer and fewer places to hide."

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