Tax professionals have warned that a proposed “strict liability” criminal offence of failing to declare offshore income and gains could result in taxpayers who have no criminal intent being sent to jail.
James Bullock, head of litigation and compliance at the law firm Pinsent Masons, said the detailed proposals are “more moderate than many had feared”, but the principle remains that “individuals shouldn’t lose their liberty and be sent to jail because they have been careless or forgetful or allowed themselves to be misled over what taxes they had to pay”.
HMRC is consulting on the design of the new offence, first announced in April. David Gauke, financial secretary to the Treasury, said then that the government “will introduce a new strict liability criminal offence that could mean jail for those who do not declare taxable offshore income”.
Pinsent Masons noted that the consultation launched on Tuesday outlines a number of possible defences, including the taxpayer being able to demonstrate that “appropriate professional advice” was sought and followed.
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