The CIOT has updated its guidance for members on the most appropriate way to respond if a client receives a letter from HMRC, inviting them to disclose details of income, gains or assets from overseas accounts or investments by completing and signing a ‘certificate of tax position’.
HMRC has been sending out such letters to individuals identified from the data it now receives from overseas tax authorities under automatic exchange of information provisions such as FATCA, CRS, CDOT or DAC.
The CIOT’s guidance, first issued in June 2019, was updated in March 2020 to take account of changes in the wording of HMRC’s letter and certificate.
The declaration in the certificate now refers simply to ‘all of my offshore income, assets and gains’, without the previous limitation offered by the words ‘which are taxable in the UK’.
HMRC has confirmed to the CIOT that there is no legal obligation for individuals to complete the certificate. HMRC will accept a response by letter as an alternative should an individual choose not to complete the declaration.
The CIOT’s overall advice on how to respond remains as before, based around three main actions:
check first with the client that their tax affairs are correct and complete to the best of their knowledge and belief before responding to the letter;
respond to HMRC’s letter, whether or not there is anything to disclose; and
in view of the serious consequences of making a false declaration, it may be preferable to respond by letter to HMRC, rather than sign and return the ‘certificate of tax position’, which applies to all years and does not have a de minimis level.
The CIOT has updated its guidance for members on the most appropriate way to respond if a client receives a letter from HMRC, inviting them to disclose details of income, gains or assets from overseas accounts or investments by completing and signing a ‘certificate of tax position’.
HMRC has been sending out such letters to individuals identified from the data it now receives from overseas tax authorities under automatic exchange of information provisions such as FATCA, CRS, CDOT or DAC.
The CIOT’s guidance, first issued in June 2019, was updated in March 2020 to take account of changes in the wording of HMRC’s letter and certificate.
The declaration in the certificate now refers simply to ‘all of my offshore income, assets and gains’, without the previous limitation offered by the words ‘which are taxable in the UK’.
HMRC has confirmed to the CIOT that there is no legal obligation for individuals to complete the certificate. HMRC will accept a response by letter as an alternative should an individual choose not to complete the declaration.
The CIOT’s overall advice on how to respond remains as before, based around three main actions:
check first with the client that their tax affairs are correct and complete to the best of their knowledge and belief before responding to the letter;
respond to HMRC’s letter, whether or not there is anything to disclose; and
in view of the serious consequences of making a false declaration, it may be preferable to respond by letter to HMRC, rather than sign and return the ‘certificate of tax position’, which applies to all years and does not have a de minimis level.
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