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In a landmark deal the Swiss government has agreed to tax money held by UK taxpayers in Swiss bank accounts.
There will also be a new information sharing provision which will make it easier for HMRC to find out about Swiss accounts held by UK taxpayers. In most circumstances, however, the deal will allow Swiss banks to retain their banking secrecy as the names of account holders will not be disclosed to the UK tax authorities.
HMRC are hoping to get up to £6 billion a year from the agreement. It is HMRC’s latest attempt to catch tax evaders and to tax money kept in offshore bank accounts.
The new tax charge
In 2013 the Swiss authorities will charge a one off tax on the bank accounts of UK citizens and pay the money directly to HM Treasury. Tax will be charged at between 19% and 34%, depending on how long the account has been open.
From 2013 the account holders will also face an annual charge of between 27% and 48% on the income from their accounts. The percentage charged will depend on whether it has arisen as capital gains, dividends or interest.
What can you do to avoid the new tax charge?
Swiss banks will alert HMRC if customers try to move their funds to other tax havens to avoid the new rules.
So if you have untaxed money in a Swiss bank account you will only be able to avoid the new tax charges if you make a full disclosure of your tax affairs to HMRC.
If you are in this position speak to us because how you make your disclosure can affect how much tax, penalties and interest you end up paying. For example you could benefit from the Liechtenstein Disclosure Facility. This HMRC disclosure opportunity limits penalties to 10% of the tax evaded and only requires you to look back as far as 1999/2000.
What happens if you don’t disclose any offshore bank accounts?
If you do not come forward now you could face fines of up to 200% of your unpaid tax plus back-taxes and interest.
What next?
We can help you resolve your tax matters as quickly and cost effectively as possible, so if you are holding money in a Swiss bank account on which you have not paid tax speak to Ruth Dooley on 01452 634800 or email her at ruth.dooley@hazlewoods.co.uk.
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