Advance warning of a general mailing from Ensors

By Danny Clifford

HMRC remains convinced that offshore tax avoidance is resulting in the loss of a substantial amount of tax every year, and they have already implemented a number of initiatives to cajole individuals who may have used an offshore account or tax avoidance mechanism to come forward, such as the “worldwide disclosure facility”.

The latest idea from HMRC is to force all financial institutions (banks, fund managers etc.) or “relevant persons” (which includes accountants) to send a letter and factsheet (drafted by HMRC) to any client who has income or assets overseas.

These letters must be sent prior to 31st August 2017 to clients who are UK resident and meet certain criteria, generally those who have been provided with offshore advice or services, or who have been referred overseas for this.

Herein lies the problem. The adviser must send the letter to any UK resident client to whom they have given such offshore advice or services. However there is, for most organisations, no foolproof way of obtaining a list that conclusively includes all such individuals. For example the advice may
have been a now long-forgotten telephone conversation about a possible overseas employment. Trawling through every client file looking for any evidence of any such advice is clearly not viable.

HMRC recognises this and as a result has given an alternative – “the general approach”.

Rather than attempting to identify specific clients, the general approach states that the adviser should send the letter to “all clients you’ve provided with advice or services for their personal tax affairs between 1st October 2015 and 30 September 2016”.

This is the approach that Ensors has chosen to adopt which means that, if you were given advice or services in relation to your personal tax affairs in the period in question you will receive the following correspondence from us over the next few months (as mandated by HMRC):

  • A covering letter on Ensors headed paper which will include an explanation of the above and certain text that HMRC have insisted be included.
  • An HMRC factsheet on holding money or assets abroad.

Clearly for almost all recipients this is a meaningless piece of correspondence.

We do apologise for the need to send this to you, but given the foregoing I trust that you will understand the position in which we (and all other advisers and financial institutions) have been placed. 

We would stress that the letter and factsheet are being sent to ALL clients who received personal tax advice or services (e.g. completion of a tax return) in the year to 30 September 2016 and the fact that you receive it is NOT in anyway an indication that we consider it to be relevant to you.

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