HMRC’s requirement to correct

Source: HM Revenue & Customs | | 20/02/2018

The new requirement to correct (RTC) legislation was introduced by the Finance (No.2) Act 2017. The legislation created a new statutory obligation for taxpayers with undeclared UK tax liabilities that involve offshore matters to disclose any relevant information to HMRC by 30 September 2018.

The RTC applies to any person with undeclared UK income tax, capital gains tax and/or inheritance tax liability concerning offshore matters or transfers. The RTC legislation relates to offshore tax non-compliance committed before 6 April 2017.

The final date (30 September 2018) for correcting historic offshore tax positions coincides with the date more than 100 countries will exchange data on financial accounts under the Common Reporting Standard (CRS). This data will significantly enhance HMRC’s ability to detect offshore non-compliance and it is in taxpayers’ interests to correct any non-compliance before that data is received.

Once the deadline ends, any new disclosure will be subject to the new failure to correct (FTC) penalties which are more punitive than the existing RTC penalties together with the possibility of taxpayers being publicly named and shamed. The FTC standard penalty will start at 200% of any tax liability not disclosed under the RTC and cannot be reduced to less than 100% even with mitigation.

Planning alert

Any taxpayers that are unsure as to whether or not they need to make a disclosure are strongly encouraged to check their tax position. The RTC rules are very complex and we can help review any historic issues and advise and assist with making any necessary disclosures to HMRC. A disclosure can be made using the Worldwide Disclosure Facility or possibly using alternative disclosure methods which may be more suitable.


Latest News

Ken Dodd has the last laugh
20/03/2018 - More...
The recent death of the comedian, Sir Ken Dodd, aged 90, would not usually be the topic of one of our weekly articles. However, the comedian managed to have one last laugh by

Self-catering and holiday let business rates
20/03/2018 - More...
One important aspect of a self-catering or holiday let business that should not be overlooked, is whether or not the owner of a holiday let is liable to pay business rates.



With our newsletter, you automatically receive our latest news by e-mail and get access to the archive including advanced search options!

» Sign up for the Newsletter
» Login