DLA PIPER ON UK & SWISS TAX DEAL
25 Aug, 2011
Director of National Tax Investigations at DLA Piper comments on the UK’s agreement with Switzerland to tackle tax evasion
The UK government has signed a tax deal with Switzerland that is expected to to secure £5bn of unpaid tax for the UK exchequer by 2015.
Commenting on the deal, Simon Airey, Director of National Tax Investigations at DLA Piper said:
“This is a ground breaking achievement for the Swiss and UK authorities. It will strengthen Switzerland’s standing as an international financial centre and effectively signals the demise of banking secrecy as a means of concealing tax evasion.
“A lot of the finer details of the deal are not yet known but if it is ratified into Swiss law, its terms will undoubtedly be attractive to those who are prepared to pay a premium to maintain their anonymity.
“For those who wish to make a clean break of things, the Liechtenstein Disclosure Facility (“LDF”) is likely to remain the most cost effective way of permanently regularising their affairs. People using the LDF typically pay between 10% and 20% of the undeclared overseas assets depending on their circumstances. On the face of it, this is less than the Swiss deal but not everyone will be eligible and it is important for people to take advice in relation to their individual situation.
“The arrangements are not likely to come into force until May 2013 so those with undeclared assets in Switzerland need to consider their position in the meantime. Both the LDF and the Swiss deal will not be available to those who are investigated by HMRC in the interim.
“Under the terms of the deal, it is important to note that HMRC will obtain certain information about the destination of assets that are transferred out of Switzerland so closing accounts in order to avoid the levy is not a risk free option.”