UK Inland Revenue To Probe Offshore Assets

by Jason Gorringe, Tax-News.com, London

26 February 2004

International law firm, DLA has warned offshore financial institutions to be on their guard following recent revelations that the UK Inland Revenue's newly formed offshore fraud group is to launch investigations into the tax affairs of UK residents with assets invested offshore.

The probe follows the publication in January of a House of Commons Public Accounts Committee Report, which estimated that a quarter of serious fraud cases investigated by the Special Compliance Office involved the use of offshore accounts and structures. The Revenue hopes to recoup some £1.6 billion in evaded taxes over the next three years.

Speaking last week, tax investigations partner at DLA, Jonathon Pickworth explained that:

"Financial institutions and trust companies should not fall into the trap of thinking that this is primarily an issue for their customers. There are clear indications that the Revenue will be looking to these institutions to eliminate practices which facilitate the evasion of tax. And if the mischief is not cured, stricter disclosure requirements and sanctions will be imposed."

In order to assist financial institutions in fully understanding the implications of the new focus on offshore arrangements and review past and current business in light of the Revenue's present thinking, DLA announced that it will be holding a seminar for Jersey financial institutions, trust companies and their advisers in the Pomme d'Or Hotel, St Helier, Jersey on 16th March 2004.

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