What if I don't disclose a bank account

[Terribly worried]

If I don't disclose a bank account how will the IR find out? Will my bank tell them?

[TSL]

Banks do complete certain forms and advise the Inland Revenue of account holders and amounts of interest credited to the account etc.

Why are you worried, is it an offshore account or an account you are receiving gross interest? If you complete a self-assessment tax return you are required to enter all details of income. If you are a basic rate taxpayer then the tax suffered on the interest will often suffice.

More details needed re why you are worried.

Taxation Solutions Limited
Tel: 0800 027 4533

[Ian McTernan CTA]

If the account is on shore and earning interest then the Revenue will in all liklihood have details of the interest earned on the account already. If you have an investigation into your affairs for some other reason then if a statement of assets and liabilities is required you would be required to enter it on that form, so before then you would have to declare any interest earned on it (and pay tax, interest and penalties if applicable).

From 1 March when the new Money Laundering Regulations come into force not reporting the income is treated as a money laundering offence and you could in theory be prosecuted if it came to light.

The Revenue will assume should the account come to light that all the money in it has come from an undeclared source of income unless you can prove otherwise...you should discuss this issue in confidence with a professional adviser immediately.

Ian McTernan CTA
McTernan Associates Ltd
Chartered Tax Advisers
ian@imcternan.com

[Terribly worried]

Thanks for your replies

I purchased a property last year with the intention of living it it...due to study/work commitments I couldn't so I let it out.

The IR found out about this and sent me a tax return.

I have also been doing freelance work as well as my regular job. The freelance work over the last 5 years has not been declared as it only involved around a £1000 per year.

Now I have to complete a tax return should I only declare the earnings from last April and hope the IR don't ask anything else or should I come clean about the previous 4 years.....as they might already know this....

Also I put down quite a big deposit for the house purchase which came from my father in law from Brazil as a gift/loan

Any advices

Thanks

[TSL]

The 2003 self-assessment tax return requires you to declare income from all sources for the period 6/4/02 to 5/4/03 i.e. rents, freelance, employment etc.

The undeclared freelance work for previous years will need to be declared to the Inland Revenue seperately as soon as possible. Coming clean will assist you when it comes to the Inland Revenue assessing your liability to tax, interest, surcharges and potential penalties.

Do not be an Ostrich and bury your head in the sand. If the Inland Revenue ask you about undeclared income you will be alot worse off than if you have told them!! The tax bill may not be as bad as you think if you ensure all tax-allowable expenses are claimed.

The gift from your father in law in Brazil is nothing to worry about. You are not liable for tax on this.

Taxation Solutions Limited
Tel: 0800 027 4533