The maximum penalty for failure to disclose income or capital gains has traditionally been 100% of the underpaid tax.
HMRC have recently published a list of more than 50 jurisdictions. Taxpayers will face penalties of up to 200% of their tax liabilities for non-disclosure of income or gains of assets invested in these countries.
The level of penalty is based on the perceived transparency of the jurisdiction and their willingness to share information. HMRC have categorised The Isle of Man and Guernsey as more transparent than Jersey or Gibraltar, for example.
This change in the maximum rate of penalties makes the ongoing Liechtenstein Disclosure Facility (LDF) even more attractive given that it attracts a fixed penalty rate of 10% – which could make a significant difference compared to a 200% penalty.
Please see our latest newsletter for further details on the LDF by clicking the link or by visiting our website directly.