Set up in 2016 to increase international tax transparency, the Worldwide Disclosure Facility (WDF) allows individuals to disclose any undeclared income and pay the correct amount of tax in the UK. HMRC receives financial information about individuals from over 100 countries which allows them to check declarations made by UK taxpayers and helps them identify any potential offshore income, money, investments, gains or assets that they have not been made aware of.
If you have received a ‘nudge’ letter from HMRC then it is likely they have some information about your affairs and believe that there may be some offshore irregularities. This is a prompt for individuals to review their tax affairs and make a WDF disclosure.
It is not uncommon for people to believe that their overseas income does not need to be declared in the UK because they have suffered tax overseas already. Quite often this is not the case and disclosure is also required here in the UK, sometimes with additional tax being payable here.
These letters must not be ignored as they can result in an investigation being opened which could result in potential penalties relating to the tax non-compliance. Whether you have received a letter or wish to make a voluntary disclosure it is always prudent to consult with a tax expert to ensure your tax affairs are in order and you can have confidence you are compliant. Our team of experts have been handling many undeclared income disclosures for individuals that have offshore assets and received a ‘nudge’ letter. We offer a free 30-minute consultation to gain an understanding of your situation and establish how your situation can be handled in the most tax-efficient manner.
