Offshore tax to most would normally mean tax havens and tax exiles. As a result you may be thinking that it doesn’t affect you. However income from a foreign pension, interest from an Isle of Man or Channel Islands bank account or renting out a foreign property could mean UK tax is payable. This could also be the case even if you never bring the money to the UK.
Tax authorities around the world are now sharing ever increasing amounts of information about income sources with each other. This could lead to an unwanted letter from HM Revenue and Customs.
If you think you owe income tax, capital gains tax or inheritance tax on undeclared offshore income or assets, then you have until 30 September 2018 to correct this by advising HMRC and paying the resulting tax, penalties and interest under the current penalty conditions. Penalties are lower if you contact the Revenue before they contact you, which is an incentive in itself.
If taxpayers do not advise HMRC by 30 September 2018, then from 1 October 2018 the minimum penalty charge will be 100% of the tax due. That is less than 6 months away, so anybody who thinks they may have an issue should act now.