Liechtenstein deal lets offshore savers off hook

UK citizens are virtually assured of immunity from prosecution under the
latest tax amnesty, even though protection is not explicitly offered by the
taxman, say advisers.

Experts believe immunity, agreed last week by HMRC for UK citizens with
accounts in Liechtenstein, is likely to apply, unofficially, to account holders
subject to an amnesty focused on 300 foreign banks that so far includes no offer
of safety from prosecution.

Speaking on Accountancy Age TV, Gary Rowson, head of investigations and
enquiries at Vantis, said it was ‘extremely unlikely’ that those who make full
disclosures under the UK amnesty – or new disclosure order – would face
prosecution.‘

That’s an all but guaranteed [from] a full disclosure,’ said Rowson.

Heather Taylor, a tax investigations senior manager at Grant Thornton, said
protection from prosecution was a ‘hopeful view’, but added that legal action
was unlikely.

With high-profile prosecutions still anticipated from the UK’s first tax
amnesty in 2007, Sue Holmes, national head of Smith & Williamson’s tax
investigations practice, said those making full disclosures were unlikely to
have to face the courts.

‘We’ve heard there’s a prosecution pending [from the first amnesty] but, as
long as people come forward and disclose, it’s unlikely they’ll prosecute.’

The taxman is expected to send out formal notices under schedule 36 of the
Finance Act to the 300 institutions over the next two weeks, telling them to
hand over details of account holders. They will then have 30 days to comply.

HMRC is likely to ask for: the name of the account holder; date of birth;
address and postcode; date the address was last checked; other names under a
joint account; the account number; the date the account was opened or closed;
balances between 31 March 2004 and 31 March 2009; and transaction details – that
is, those taking place within the first three months the account was opened or
closed including dates, amount in sterling, debit or credit, then the balance
after the transaction.

HMRC said: ‘HMRC’s policy is to deal with fraud by use of the cost effective
civil investigation of fraud procedures, wherever appropriate.

Criminal investigation will be reserved for cases where HMRC needs to send a
strong deterrent message or where the conduct involved is such that only a
criminal sanction is appropriate.

‘We prefer voluntary cooperation but cases have been investigated and we do
not discount prosecutions in the future.’