HMRC's "Offshore Income or Gains” Letters

HMRC are currently sending out letters to taxpayers requesting more information on overseas income and gains, which may not have previously been disclosed to HMRC.  This letter has been sent because HMRC has received information that suggests you may have overseas income or gains to declare.

As you may be aware, information is provided to HMRC from a variety of sources, but these recent letters from HMRC appear to be prompted as a result of information exchange agreements the UK has entered into with a significant number of overseas jurisdictions.   The agreements entered into are known as Automatic Exchange of Information (AEOI) agreements, the Common Reporting Standard (CRS),  the United States Foreign Account Tax Compliance (FATCA), Crown Dependencies and Overseas Territories (CDOTs).

Whilst unwelcome, it is expected that most taxpayers with an overseas asset will receive these letters. This letter does require a formal response and it must be dealt with by the required deadline, typically a month from its issue date.

That response requires careful and serious consideration as HMRC are asking you to certify that your tax affairs are in order and that you do not intend to take any further action, or alternatively that you intend to make a formal disclosure to bring your tax affairs up to date and will therefore register to do so using HMRC’s Worldwide Disclosure Facility.

Failure to take corrective action when it is required will have serious consequences and we therefore recommend that you contact us to discuss how we can assist.  We are specialist tax advisers with significant experience and expertise in assisting non-domiciled, UK resident individuals manage their international tax affairs.  For further information on the services we provide for our international clients please click this link.