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Taxpayers who know or suspect that they have unpaid tax relating to overseas assets, income or activities need to act before the deadline of 30 September 2018 to avoid incurring much higher penalties for non-compliance.
HMRC is urging accountants, tax advisers and individual taxpayers to ensure they do not fall foul of the new Requirement to Correct (RTC) rules which requires taxpayers to make a disclosure of unpaid tax on assets, income and activities in other countries and transfers from the UK to other countries.
With the 30 September deadline on the horizon, HMRC is urging taxpayers and agents to check whether they need to make a correction under the RTC.
From 1 October 2018, the minimum penalty will be 100% of the tax owed and could be much higher depending on circumstances.
The RTC has no minimum level cut-off point so all those with any unpaid offshore tax will need to make a disclosure.
This means, for example, that taxpayers who have simply rented out a holiday home in another country and failed to declare the income should check their position.
In addition, those who have moved to the UK from abroad but who have, for example, assets or income, perhaps from family holdings or businesses, in their country of origin may need to make sure that they have properly declared their tax position.
The RTC applies to income tax, capital gains tax and inheritance tax, and mainly affects individual taxpayers.
However, companies that pay income tax, for example, as non-resident landlords, will also need to ensure they have paid the correct tax and if necessary make a disclosure.
Trustees, settlors and beneficiaries of trusts with overseas interests may also need to check whether they have unpaid UK tax liabilities.
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Article – CCH Daily
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