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HMRC wins case for access to 308 banks offshore accounts

More than 300 financial institutions have been ordered to hand over details of customers with offshore accounts after HM Revenue & Customs won so-called production orders against them.

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More than 300 banks and financial institutions have been ordered to hand over details of customers with offshore accounts after HM Revenue & Customs won so-called production orders against them.

The names of the 308 affected institutions were not known, but it is understood that “a number” are UK institutions with branches in Switzerland. Others are foreign banks with UK clients.

The orders, which were issued this morning, follow similar writs being obtained earlier this year against a handful of banks, as well as in 2007 against five other British high street names, Barclays, HBOS, HSBC, Lloyds TSB and Royal Bank of Scotland.

“In terms of developments affecting investigations, this is massive,” said Frank Strachan, senior manager, national tax investigations for Grant Thornton.

He further noted the ruling will give HMRC a significant boost in its efforts to convince UK-resident tax evaders to take advantage of its recently-unveiled new disclosure opportunity (NDO), which is aimed at encouraging such individuals to “come in from the cold” one last time with reduced penalties for any unpaid taxes owing of 10%.

“The message from HMRC to UK residents with undisclosed accounts offshore is quite simple,” added Strachan.

“We will at some stage in time, get you — whether it’s now, or a year, two years, four years or five years from now. We will methodically go through the data that we will eventually be provided with, and at that stage we will investigate you,” said Strachan.
 

This is understood to be the end of HMRC’s interest in obtaining production orders from UK banks.

HMRC has warned there will be no further "disclosure facilities".  Anyone found to be evading taxes through offshore accounts after next March, when the NDO ends, will face repaying the full amount of undeclared taxes, plus fines and possible criminal prosecution. 

Today’s ruling could, however, be challenged under judicial review, Strachan added.

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