1. A Brave New World?
UK tax risk in a hostile climate
Our experts have a wealth of experience in dealing with HM Revenue and
Customs (HMRC) enquiries. Particular areas where we have technical
expertise are:
Complex personal return enquiries, including residence/domicile, cross border and
offshore risks
Advising on Channel Island and Isle of Man wealth structures: analysing risk,
resolving legacy issues and assisting with restructuring
Defence of tax mitigation and avoidance schemes
Identifying areas of tax risk and working to reduce risk profiles
Residence and domicile issues post 2008/09 for HNWI
Tax risk advice on pre-transaction planning
Responding to Schedule 36 information notices: first party or third party
Disclosure and discovery issues associated with tax returns
Making voluntary disclosures to HMRC
Achieving advantageous settlements through the Liechtenstein Disclosure Facility
Guidance on HMRC reviews, the tax Tribunal and Alternative Dispute Resolution
HMRC initiatives and targeted campaigns
The impact of information sharing between international tax regimes
Our specialists are skilled in negotiating manageable settlements with HMRC across all
taxes including income, corporation, capital gains, VAT and inheritance tax.
Countries are increasingly sharing financial and tax information, such as through the recent UK-
Swiss and UK-Isle of Man tax treaties, and wealthy individuals are particularly vulnerable to HMRC
activity, to uncertainty about how to manage their personal and business affairs in this new, global
era and to the reputational damage from HMRC enquiries.
Grant Thornton's National Tax Investigations team can help navigate this new world. Our team
includes several ex-HMRC investigators and we are specialists on how HMRC identifies, defines and
tackles tax risk. We are also experienced in resolving disputes with HMRC.
Whether you need a risk review, analysis of proposed arrangements or resolution of an HMRC
enquiry, we can help identify and manage tax risk across all taxes, whether outside or during the
HMRC enquiry process. We can also advise on the rare opportunities which still exist, such as the
Liechtenstein Disclosure Facility.
2. • Have you considered your domicile position
recently?
• Are your assets structured in the best way
to make use of your non-domicile status
• Are you considering bringing offshore funds
into the UK?
• Are you aware of the new rules for high
value residential properties?
• Have you recenrtly bought or sold a
high value property?
• Have their been any changes in your
personal situation which might affect
your tax position in the UK?
• Have you recently sold or are
considering restructuring your
business?
• Have you recently come to the UK for work
or are you planning on leaving the UK?
• Are you aware of the new Statutory
Residence Test applicable from 6 April
2013?
• Do you know how this will affect your
residence position?
• Are you thinking of passing your wealth on
and want to know more about the UK tax
consequences of this?
• Are you aware of your current potential UK
inheritance tax liabililty?
• Have you made or received any large gifts
within the family?
• Do you hold any trust structures?
Passing on
family
wealth
Residence
Domicile
Changes
in your
asset base
How HMRC get
information
New hostile
regime with
information
sharing between
different countries
Who deals with the
information
Offshore disclosure unit
High Net Worth Unit
Specialist Investigations
Personal Tax International
Trusts and Estates
Large Business Service
Anti- Avoidance Unit
What HMRC do to you
Enquiry and
investigations
Formal information
requests
Litigation
The economic downturn has resulted in an increasingly hostile environment within which
taxpayers must now operate. HM Revenue & Customs are increasing their activity and below
we highlight some areas of interest to HMRC and show how the current climate leads through
to HMRC activity.
A changing environment
3. Offshore experience – client perspective
"I have been a client of Grant Thornton for my personal tax returns
for some years. A few years ago I inherited an offshore structure
from my father, and I had an issue with HMRC concerning
inheritance tax.
I consulted Paul Roberts and the team and National Tax
Investigations took a proactive approach to dealing with the
queries raised by HMRC, including the preparation of a strong
technical argument which took the whole structure outside the
scope of UK inheritance tax and resolved the problem. I am most
impressed with the innovative solutions and exceptional client
service. I recommend them very highly indeed."
Anonymous
HMRC information requests
A high net worth, non-domiciled individual
was served a Schedule 36 information notice,
requesting full bank statements for all non-
UK bank accounts over a 3 year period. The
client's concern was that HMRC were
seeking to investigate their whole family,
potentially damaging their privacy and
reputation.
Grant Thornton appealed the notice and
successfully persuaded the HMRC review
officer that the notice could not be used, due
to promises given to Parliament about the
uses of HMRC's formal powers. As a result
Grant Thornton was able to defend the
family's reputation as well as restricting the
scope of HMRC's enquiries. Grant
Thornton also worked with the client's two
sets of legal representatives and leading
Counsel to resolve the issue.
Offshore experience – client perspective
"I came to Grant Thornton with a legacy offshore tax issue. Their
Tax Investigations team worked with their Personal Tax team to
resolve the problem for previous years and to advise me on the best
way to manage my affairs going forwards. this was done with
professionalism and sensitivity at all levels, and, as a result, I have
become a personal tax client of the firm."
Anonymous
Professional recommendations
"I have worked with Grant Thornton’s UK Tax Investigation Team
on several projects regarding disclosures over the last 5 years and
have found their knowledge of the UK tax system to be excellent .
They have always ensured that my clients privacy and interests
were protected whilst seeking an innovative solution to the
problems they faced. They have also always shown great empathy
towards my clients and the confidence in their knowledge of the
mechanics of HMRC helped put my clients at ease during what is a
very stressful and upsetting time for them.
I would gladly recommend the Tax Investigation Team of Grant
Thornton to my peers and my colleagues as their knowledge of the
UK tax system is outstanding and I am looking forward to a
continuing collaboration in further projects."
Anonymous, Swiss Lawyer
Voluntary disclosures to HMRC
Grant Thornton have significant experience
advising clients on the UK-Swiss agreement
and in guiding them through the
Liechtenstein Disclosure Facility (LDF).
We are also successful in framing voluntary
disclosures to HMRC outside of these
facilities, using our good relations with
HMRC to find the appropriate teams to
handle the disclosure and agree pragmatic
terms of disclosure.
Recently, we were able to agree a practical
methodology with HMRC on a long-running
non-UK trust with UK beneficiaries where
capital gains in excess of £10m had been
distributed , saving both tax costs and
professional fees for the client.
Discretion and negotiation
A director of a PLC company approached
Grant Thornton with a view to making a
voluntary disclosure to HMRC in respect of
personal undeclared receipts that had been
solicited from his business contacts within
the industry sector. HMRC's initial position
was to include non-business receipts in the
settlement, which could have led to tax
liability in excess of £600,000. Grant
Thornton carried out a discreet investigation
of the client's private financial affairs,
without compromising his status within his
industry, resulting in a settlement of c.
£350,000 which included tax, interest and
penalties.
Offshore experience – client perspective
"We came to Grant Thornton for help in resolving a UK-based tax
issue involving our multi-site family business and offshore personal
assets. Grant Thornton were able to agree with HMRC that this
situation could be handled through the LDF, providing us with
protection from the risk of criminal prosecution as well as
preferential terms. Grant Thornton were able to find a strong
negotiating position with HMRC and we are very happy with the
financial outcome achieved. Grant Thornton reached a pragmatic
solution with HMRC, whilst respecting our family's circumstances
at all times."
Anonymous, LDF Client
Case studies Client quotes
