50% withholding tax deal on funds hidden in Switzerland

Accountants in London may want to know that the Financial Times has reported that Britons who have been salting away their money in Swiss bank accounts will have to pay a 50% withholding tax.

According to Britain’s popular finance newspaper, a “source close to the negotiations” has reported that agreement has been reached with the Swiss to collect the 50% levy on behalf of our government.

It is thought that the deal will be announced within the next month and once implemented, will raise around £3bn for the Treasury. People with Swiss bank accounts will also have to pay a retrospective levy on previous unpaid tax but the agreement does allow them to retain their anonymity.

Andrew Watt, the MD of independent global professional services firm Alvarez & Marsal, said this sort of agreement would have been unthinkable a couple of years ago. However poor the agreement, even it provides just a slither of light in the battle to stop tax evasion, it is still astounding.

The recent negotiations with Switzerland have prompted an outcry from Liechtenstein which has had a long-standing agreement with the UK to levy lower than usual penalties, and offer immunity from prosecution, to tax evaders.

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