Final warning to offshore tax dodgers

Money

Tax evaders hiding money offshore could face new penalties of up to 200 per cent from 6 April 2011.

Penalties for offshore non-compliance - for income tax and capital gains tax - will now be linked to the tax transparency of the country involved.

There will be increased penalties in place for under-declared income and gains from territories which do not automatically share tax information with the UK.

David Gauke, Exchequer Secretary to the Treasury, said: “Time is running out for anyone going offshore to evade tax. Get your tax affairs in order or face the risk of a penalty worth up to 200 percent of the tax evaded.”

Dave Hartnett, Permanent Secretary for Tax at HM Revenue & Customs, said: “We have made significant progress tackling international tax evasion and closing in on tax havens in recent years.

“This is the next step in increasing the deterrent against offshore non-compliance – and those who decide to take the risk will feel the full force of HMRC’s new penalties.”