A new advertising campaign has been launched by UK chancellor George Osborne following February’s G20 summit in Australia. There has been a shared commitment by the G20 to tackle global tax avoidance and evasion. The advertising campaign is looking to target people who have stored money in offshore bank accounts, and highlights how tax evaders face fines of 200% of the tax owed, and the possibility of criminal prosecution with a prison sentence. However, the HMRC are encouraging voluntary disclosure to avoid this.

George Osborne said that the campaign acts as a reminder to those who are hiding money in secretive tax havens . “We are coming after them,” he warned. He continued to talk about “greater transparency and fairness to the global tax system”, with an aim to take global action alongside G20 counterparts to reform the system.

Knocking on the door

All of the incremental developments over the past few years have increased the chances of HMRC catching and deterring tax evaders. Figures show HMRC successfully prosecuted more than 600 people for tax evasion in 2012-13, more than double the amount in the previous 12 months, and well ahead of the target for the year

Since late 2011, the UK Government has had a tax agreement in place with the Swiss authorities to achieve co-operation in respect of the taxation of income and gains. Recent developments have led to the HMRC signing IGAs (International Governmental Agreements) with Guernsey and Jersey, aiding the improvement of International Tax Compliance.

Global fight against tax evasion

G20 finance ministers have endorsed a new global standard for the sharing of tax information between members, and the noose is beginning to tighten. The agreements, put forward by the Organisation of Economic Cooperation and Development (OECD), have prompted the G20 to try and stop multinational companies shifting their profits around different jurisdictions to avoid paying tax. They are hoping to achieve this through the OECDs base erosion and profit shifting (BEPS) project to reform the global tax rules and tackle profit-shifting.

It’s important with the rapidly shifting developments in global agreements and initiatives that you seek professional advice about your personal tax circumstances. Contact us with any UK tax questions.