The new tax agreement, which was formally signed between the two countries in October last year, will mean that UK account holders must either provide full details to HMRC or pay a proportion of the money in their account and a future withholding tax.
Exchequer secretary David Gauke said: “The days when hiding money in Switzerland in order to evade tax are over. Burying your head in the sand is no longer an option. The only realistic strategy is to talk to HMRC, as quickly as possible.”
Frank Strachan, tax partner at Edwin Coe LLP, points out that the Liechtenstein Disclosure Facility is still open, and will remain so until 2016, and that the terms offered by the LDF are favourable for those clients concerned about the Swiss agreement.
"David Gauke’s statement cannot be any clearer," said Strachan. "At Edwin Coe we have seen a surge in the number of people coming forward to understand their options in respect of the regularisation of their Swiss portfolios. The terms offered by the LDF provide for a swift and cost effective way to ensure assets contained within the Swiss portfolios become compliant. My advice to anyone in doubt is to act now, seek professional advice if only to understand the options available to you."
The tax authority’s warning came as it announced a victory in court over a tax avoidance scheme, which it says will potentially save the exchequer £104m in lost revenue.
According to the revenue, the scheme claimed to license newspaper mastheads in order to avoid tax. However, a tribunal ruled that the subsidiaries of Iliffe News and Media were not entitled to a tax deduction for payments they had made to their parent company to use their own mastheads.
HMRC said closing the scheme had “protected” £5.6m and “potentially saved” £104m in 67 similar cases.