Extension of Offshore Time Limits
LITRG has raised serious concerns to the government over its plans to extend the time limits for raising an assessment of tax on offshore investments. The proposals would have effect only where the loss of tax has not been brought about deliberately. The existing time limits would be extended to twelve years, irrespective of whether or not reasonable care had been taken.
We suggest that the proposals are unfair and poorly targeted, adding complexity to the existing regimes. Unfortunately, the scope of the consultation is limited to the design of the legislation rather than the principle. Should they be taken forward, we have made it clear that the proposals must consider unrepresented taxpayers, who may have made mistakes entirely innocently. As a minimum, safeguards should be introduced to minimise unnecessary distress caused by HMRC investigations and to restrict the new powers where the loss of tax is immaterial.
The consultation document can be found here.
The LITRG response can be found here.