World Wide disclosure Facility fees for client

A client received a letter from HMRC to declare foreign income/gains

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My client received a letter from HMRC to complete a World Wide Disclosure Facility form. They have off shore investments that was never declared in the UK.

To those who have done this task before , how long does it take to complete, and how much fees do you charge. (note this is a new client)

Do you pay HMRC at the time of submitting the form, if so how much?

Lastly how do calculate the amounts due to be paid for the non disclosure?

Thanks for the help.


Replies (11)

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By David Ex
04th May 2024 11:39

I suspect the answer is that if you aren’t familiar with the process, pass on the client to someone who is.

Has the prospect not used an accountant before or are they maybe deliberately approaching someone new?

Thanks (4)
By taxdigital
04th May 2024 12:14

I can only give you an outline answer.

Unless remittance basis applies, you will need to work out UK tax on worldwide basis for each tax year in question. In doing so, you ought to consider UK tax treatment of various items of investments (e.g. offshore income gains) besides looking up the tax treaty provisions, how the tax was computed in offshore jurisdictions, foreign tax relief etc. Once you have worked out the UK liability for each tax year, you will need to work out the overdue interest and apply penalty at the appropriate rate.

Penalty depends on client behaviour: careless, deliberate etc, the offshore territory involved, whether it was about an inaccuracy or failure to notify etc etc. Even where it's careless one HMRC could go back up to tax year 2013-14. Failure to correct penalties up to 2015-16 and for failing to notify cannot be suspended.

As for the fees it would depend on the firm's policy: fixed fees, hourly or whatever. You could break it down to: yearly tax computation x number of tax years involved, how complex the case is, and the expected number of touch (pain) points with HMRC.

In terms of timescale, if you agree with everything that HMRC say, or if HMRC agree to everything that you say it will be all over in about 3 months. Otherwise, it could take months. Six months is the average and in some cases you will still be arguing with HMRC solicitors even after three years have passed!

PS - tried many times to post this.
Agree with David's comment above.

Thanks (1)
Replying to taxdigital:
By [email protected]
04th May 2024 13:27

@ Tax digital, thank you for the comprehensive respond , very helpful.
I had a further conversation with the prospect and he mentioned that he is an international student ,and he use his offshore account to pay the UK student fees.
Not sure if he has to complete the World wide Disclosure facility form .

Thanks (0)
Replying to [email protected]:
By Paul Crowley
04th May 2024 21:45

And did you ask and get evidence of the source of those funds?
Does it get interest credited?
Will you need to research non dom rules and tax treaties?

Thanks (1)
By Matrix
04th May 2024 13:59

I find you don’t make much money on these one-off jobs, especially if you have to learn all about the process and never use the knowledge again. I don’t think you should charge your client for learning about it anyway.

Thanks (1)
By OldParkAcct
04th May 2024 17:55

Suggest you think about passing this on. It’s not something you want to be doing without any experience.
If there was any future complaint by the client I doubt your Institute would look kindly on you taking on work for which you do not have the relevant knowledge.

Thanks (2)
By Paul Crowley
04th May 2024 21:42

Not my cup of tea. A once off on a matter I have never dealt with? I leave that to the young and foolish.
Phone your PII company and chat to them.

Thanks (3)
By jonharris999
05th May 2024 06:08

You would need to work with another practice senior or mentor to train you on how to do this. You are asking only about some of the issues to consider - there are many others.

Thanks (0)
By Justin Bryant
05th May 2024 12:58

This can be anywhere between very simple (e.g. a few Swiss francs interest a year in a Swiss bank accout funded from post tax income) to very, very complex (e.g. 20 years significant income from a US LP where she's had a Green Card for some of that time).

Thanks (1)
By Homeworker
08th May 2024 15:49

I've done a couple of these, one for a client of TaxHelp, and both were relatively easy apart from the calculation of the interest charge, as I couldn't download the calculator provided!
You will need details of all income and allowances for each year and provided they are UK resident and you have all of the information to hand it needn't take long.

Thanks (1)
By Accountant2020
10th May 2024 19:14

I had one recently which took 9 months from start to finish. I quoted fixed fees for calculation of the tax liability for each tax year and an hourly basis for any follow ups with HMRC. I'm glad I structured it in this way as there was a lot of going back and forth with HMRC in agreeing the final outcome. HMRC can be paid from when they accept the client offer, you can also arrange a payment plan with them.

Thanks (1)