14th February 2018
Tax dodgers might be under the misconception that they can get away with fraud if they relocate to another country. But with authorities across the globe clamping down on illegal activity, there really is no place for wrong-doers to hide.
Israeli tax dodgers being hunted
According to reports from a leading Israeli financial newspaper, Globes, the country’s Tax Authority director general, Moshe Asher, flew to London at the end of January in a move to recover billions of dollars that Israel citizens are allegedly hiding in the UK. During his two-day visit, Asher had back-to-back meetings with some of the country’s largest banks in order to develop closer relationships in the fight against tax evasion.
In a move that replicates the relationship Asher implemented with Switzerland back in 2014, the director general is seeking the help of the UK’s banks in encouraging customers to voluntarily disclose their concealed capital. As part of this request, he has asked the banks to provide assistance to Israeli customers when preparing orderly reports of their UK income, including the provision of transactions from UK-Israeli bank accounts in the last ten years.
Deadline day is looming
These requests support Asher’s work on tackling the loss of billions in tax payments due to hidden assets. In order to encourage citizens to come forward, the Tax Authority is allowing the anonymous disclosure of information which will allow customers to remain unnamed until the full tax result is obtained. As part of this gesture, those coming forward will not face criminal proceedings, but will have to pay the relevant back taxes and fines.
This offer does have a time limit, however, with anonymous disclosure procedures available until the end of the year. Those choosing to voluntarily come forward through normal routes will have until the end of 2019 to disclose income without facing criminal charges.
Israel joining the global fight
This news comes amid a flurry of worldwide activity, with authorities sharing information as tackling tax evasion remains a priority for global governments. With data being transferred across borders as part of the Common Reporting Standards (CRS), Israel is certainly cementing its position as a key player in this fight against fraud. The country is also receiving information from the US under the Foreign Account Tax Compliance Act (FATCA) and has signed in excess of 50 conventions for the prevention of double taxation.
For recruitment firms working with global contractors, this latest news really does demonstrate the complex nature of tax and employment legislation. No matter where in the world a professional is working, they will need to make the correct declarations both home and abroad. As authorities target fraudulent behaviour, contractors will certainly be turning to recruiters for advice. But with the risks associated with incorrect declarations for individuals and businesses alike, it really is something that is best left to the experts.
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