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Making Tax Disclosures to HMRC: A Guide for Expats with Overseas Assets

Tax Disclosures to HMRC

Tax compliance can be a complex matter, especially for expats who have financial ties to the UK while living abroad. If you’ve made mistakes on your tax returns or failed to declare your overseas assets to HM Revenue & Customs (HMRC), it’s crucial to take corrective action as soon as possible. HMRC offers specific disclosure facilities tailored to expats to help rectify these errors and ensure compliance with UK tax laws. In this blog post, we’ll guide you through the process of making tax disclosures to HMRC if you’re an expat with overseas assets.

Why Expats Should Disclose Overseas Assets to HMRC?

For expats, failure to declare overseas assets or income can lead to serious consequences, including:

  • Penalties and Fines: HMRC can impose substantial penalties for non-compliance, which can be significantly higher than the tax owed on the undeclared assets or income.
  • Criminal Prosecution: In severe cases of tax evasion or fraud, HMRC may pursue criminal prosecution, which can result in fines, imprisonment, or both.
  • Financial Strain: Unpaid taxes, penalties, and interest can quickly accumulate, leading to financial difficulties, especially for expats who may also face currency exchange risks.

Types of Overseas Asset Disclosures for Expats

  1. Failure to Correct (FTC) – The Failure to Correct (RTC) regime was introduced to encourage taxpayers, including expats, to disclose undeclared overseas assets and income. Under the FTC regime, taxpayers have a duty to correct any offshore tax non-compliance by making a disclosure to HMRC and paying any outstanding tax, interest, and penalties.
  2. Worldwide Disclosure Facility (WDF) – The Worldwide Disclosure Facility (WDF) is another option for expats to disclose undeclared overseas assets and income voluntarily. The WDF offers certain benefits, such as reduced penalties compared to standard penalty rates and the possibility of avoiding criminal prosecution.

Steps to Make a Disclosure as an Expat

Step 1: Determine Your Tax Status

Firstly, determine your tax residency status in the UK and your country of residence as an expat. If you’re a UK resident for tax purposes or a non-resident with UK ties, you’re generally liable to pay tax on your worldwide income and assets. Non-residents may have different tax obligations, and double taxation treaties may apply for expats.

Step 2: Gather Relevant Information

Collect all relevant information and documentation relating to your overseas assets and income as an expat, including:

               Bank statements from both UK and overseas banks

               Investment statements

               Property ownership documents

               Rental income details

               Any other relevant financial records

Step 3: Use HMRC’s Online Services

HMRC provides online facilities for expats to disclose overseas assets and income:

           Digital Disclosure Service: This service allows you to disclose undeclared income or assets online. Provide details of the income or assets, the tax years involved, and the amount of tax due.

      Worldwide Disclosure Facility (WDF): If you choose to use the WDF, notify HMRC of your intention to make a disclosure and provide detailed information about your undeclared overseas assets and income as an expat.

Step 4: Calculate Tax, Interest, and Penalties

HMRC will calculate the tax due on your undeclared overseas assets and income, along with any interest and penalties. Review HMRC’s calculations carefully, considering currency exchange rates and potential double taxation issues, and seek professional advice if necessary.

Step 5: Make Payment to HMRC

Once you’ve agreed with HMRC’s calculations, make the payment for the tax due, interest, and penalties within a specified timeframe, taking into account currency exchange rates and any potential double taxation issues.


For expats, navigating tax compliance can be particularly challenging due to the complexities of overseas assets, currency exchange risks, and potential double taxation issues. If you’ve made errors on your tax returns or failed to declare your overseas assets to HMRC as an expat, it’s crucial to take corrective action by making a disclosure as soon as possible.

HMRC offers specific disclosure facilities, such as the Failure to Correct (FTC) regime and the Worldwide Disclosure Facility (WDF), tailored to expats to help rectify these errors and ensure compliance with UK tax laws. Making a voluntary disclosure can result in reduced penalties compared to if HMRC discovers the undeclared assets or income first.

If you’re an expat unsure about your tax obligations or how to make a disclosure correctly, seek professional advice from a qualified accountant or tax advisor familiar with expat tax issues to guide you through the process and ensure compliance with HMRC’s requirements.

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