July 12, 2020

UK tax evasion action hunt identifies 100 individuals


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A joint investigation by the UK, the US and Australia to identify those using offshore tax havens to hide wealth has uncovered more than 100 people.

Her Majesty’s Revenue and Customs (HMRC) said some of these were already under investigation for tax evasion.

It said it has obtained large quantities of documents which reveal those, along with professional advisers, who may be involved.

Evasion is illegal, tax avoidance is not.

The hunt was sparked by a joint investigation by the BBC’s Panorama programme, the Guardian newspaper and the Washington-based International Consortium of Investigative Journalists.

HMRC is working on the material, which it describes as 400 gigabytes of data, with the tax authorities in the United States and Australia.

So far HMRC has pinpointed more than 100 people from the information, whom it says benefited from using offshore havens such as Singapore, the British Virgin Islands, the Cayman Islands, and the Cook Islands to hide their assets.

More than 200 UK accountants, lawyers and other professional advisers will also be scrutinised.

HMRC refused to disclose where the documents came from, but an official suggested they constituted the largest haul of offshore tax evasion data obtained so far.

Tax evaders risk being charged fines equivalent to 200% of the amount of tax they should have paid.


The Chancellor, George Osborne, said: “The message is simple: if you evade tax, we’re coming after you.

“This data is another weapon in HMRC’s arsenal.”

Chas Roy-Chowdhury, head of taxation at the ACCA accountancy body, said that it was still a small number of people who were evading tax in these markets.

“The majority of accountants, lawyers and other professional advisers, as well as their clients, are not breaking any laws in these locations. There is a large gulf between what amounts to tax avoidance, which is within the law, and tax evasion, which is illegal,” he said.

“While this joint initiative with the US and Australian authorities is a positive step from HMRC, the Cayman Islands, Cook Islands and other offshore jurisdictions targeted are not going to suddenly lose their tax friendly status by this move. This is a crackdown on evasion and these locations will remain hot spots for individuals seeking to reduce their tax bill within the perimeters of the law.”

Last week, Bermuda and other British overseas territories with financial centres signed agreements on sharing tax information.

The move follows similar recent deals with Jersey, Guernsey and the Isle of Man.

The action is aimed at tracking down banking clients who escape paying taxes by hiding their money overseas.

An international drive against tax evasion and the use of tax havens has been picking up steam.


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