The volume of data provided by foreign tax authorities to HMRC about UK taxpayers living abroad has surged by 48% over the past five years.
In 2019, there were 6.4 million disclosures from foreign tax authorities to HMRC regarding UK taxpayers. This figure has increased annually, with 7.4m in 2020, 9.2m in 2021, and 9.5m in 2022.
HMRC receives data from tax authorities in over a hundred countries through the Common Reporting Standard (CRS), part of the global OECD tax framework.
121 countries participate in the CRS, including former ‘offshore' tax havens like Switzerland, Bermuda, the British Virgin Islands, and the Cayman Islands. Individuals needing to disclose untaxed offshore funds can do so via HMRC's Digital Disclosure Service (DDS) or its Contractual Disclosure Facility (CDF).
Doing so can reduce any penalties incurred if HMRC discovers the assets. If investigators find untaxed assets, HMRC can impose ‘super penalties' of up to 200%.
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