25 Aug, 2011

UK signs 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.

The deal will mean that UK taxpayers with funds in Swiss bank accounts will have to pay tax rates of 48 per cent on income from investments, 40 per cent on dividends and 27 per cent on gains. The move is a bid by the UK government to stop people from hiding the proceeds of tax evasion and is expected to come in to force in 2013, subject to Parliamentary scrutiny.

People who have already paid their taxes will not be affected, and under the agreement terms, existing UK taxpayer funds in Switzerland will have to pay a one-off deduction of between 19 per cent and 34 per cent to clear previous tax liabilities.

According to the BBC, Dave Hartnett of HMRC commented: “The world has changed for tax evaders. A few years ago, nobody would have anticipated that we would conclude an agreement with Switzerland to tackle tax evasion”

He continued:”We will secure significant sums of tax that some had thought we would never see.”

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