The Northern Ireland Tax Committee recently responded to the informal consultation by HMRC on the client notification requirement contained in section 50 of the Finance (No. 2) Act 2015. Since that consultation the Committee has responded to the second and third rounds of this consultation which examine the revised guidance and regulations, in light of concerns expressed by this Institute and other professional bodies.

Section 50 imposes obligations on advisers providing “offshore advice” to clients, to send an individually addressed covering letter from the adviser’s firm which must include certain wording provided by HMRC; the letter must also enclose a HMRC branded letter. The correspondence is intended to alert clients to the possibility of HMRC compliance intervention in the event of untaxed moneys being held abroad.

In its most recent submissions, the Committee has been focused on ensuring the requirement is couched in such a way that it is as practical and fair as possible for members affected. Clarity has also been provided around crucial elements of the requirement including the definition of offshore advice and services. In addition, it is now appears that a letter will not need to be sent if offshore services are provided but the only service was the preparation and submission of a Self-Assessment return.

HMRC have recently contacted us to advise that the expected implementation date of the client notification requirement regulations on 30 June 2016 has been postponed. A revised date is not currently available but it is expected to be some time in summer 2016. As a result, the period to comply with the regulations will similarly be pushed out from 30 April 2017 to an appropriate end point to allow for the obligation to be incorporated as far as is possible into “business as usual” for those affected.