23rd November 2017.
HMRC Given Powers to Thwart Tax Evaders
As many expected, in his new Autumn Budget Chancellor Philip Hammond has unveiled new measures aimed at cracking down on tax avoidance.
The chancellor had been under some pressure to tackle offshore tax avoidance after the public anger over details revealed in the Paradise Papers.
Hammond claimed the government has already collected £160 billion in additional tax revenue through an ongoing crackdown on evasion.
The new measures are projected to raise an additional £4.8 billion by 2022/23.
Hammond’s new measures will force companies to inform HM Revenues and Customs (HMRC) of any offshore structures they are involved in and the clients using them.
To help HMRC clampdown on avoidance, the Revenue will receive £300 million to hire staff and invest in technology.
The taxman will also be given the power to assess at least 12 years of offshore tax non-compliance without having to prove deliberate evasion, three times the current four-year period.
Similarly any payments from an offshore trust intended for a UK resident individual made via an overseas beneficiary no longer escape tax, nor do non-resistant’s gains on immovable property.
These changes have been well heralded, and have been the subject of much discussion.
The changes will come into effect by 1 April 2019 for companies, and 6 April 2019, for individuals.
Yesterday it was also announced the publication of a HMRC policy paper that contains 18 measures designed to combat “aggressive tax planning, avoidance, evasion and non-compliance”.
The paper explains that the UK is “spearheading” international efforts to improve tax transparency”.
The government intends to extend the scope of their current legislation, and has already introduced a capital gains tax charge on non-residents owning UK residential property.
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