Taxpayers who identify errors in their tax returns or fail to advise HMRC that they have become liable to tax should approach HMRC to put things right before they are discovered. That is because making a voluntary disclosure is not only looked upon more favourably by HMRC, but it can also reduce the amount of the resulting financial settlement.
Where HMRC discover errors or omissions, in addition to recovering tax and late payment interest, HMRC can charge penalties of up to 100% of the tax due if the failure concerns a UK matter or 200% for overseas related issues. Voluntary disclosures can reduce those penalties considerably, particularly where any corrective submissions made to HMRC demonstrate that the taxpayer has fully cooperated with the disclosure process and has been transparent in quantifying the tax arising.
With continuing advances in information technology and more overseas tax jurisdictions routinely sharing information with HMRC, it is increasingly likely that tax errors and omissions will be discovered. Therefore, it is important to act quickly to bring your tax affairs up to date before it is too late.
Our team of experienced tax professionals have worked at the Big 4 accountancy firms and as senior tax inspectors at HMRC and can help you deal with any voluntary tax disclosures professionally and with the minimum disruption possible.
If you would like a free, confidential and no-obligation initial discussion, please contact us.