This Practice Note explains the criminal offences relating to offshore tax evasion in section 106 of the Taxes Management Act 1970 (TMA 1970). Offences under the TMA 1970 Offences under the Taxes Management Act 1970 (TMA 1970) include: • failing to give notice of being chargeable to tax • failing to deliver a return • making an inaccurate return Who may be guilty of the offences? Any person who has failed fully or accurately to disclose that they are chargeable to income tax (IT), capital gains tax (CGT) or both in relation to offshore matters. The government has made clear its expectation that normal rules of criminal secondary liability would also apply and that therefore the offence would extend to an agent who knowingly submitted returns which did not declare tax due. See Practice Note: Joint enterprise and secondary liability. Elements of the offences which the prosecution has to prove The elements of the offences are explained in the sections that follow. However there are

For further practical guidance on key legal issues in the wind sector, see also textbook: Wind: Projects and Transactions. Note that additional commentary on the issues discussed in this Practice Note in the context of the regulation, consenting and incentivisation of the net zero energy transition is available in the following textbook that we have published: Collinson and Hockman on Energy Law: Regulating, Consenting and Incentivising the Energy Transition. Requirement to transfer offshore transmission assets Why are generators required to transfer offshore transmission assets? A key element of an offshore wind farm is its connection to the onshore electricity network through offshore electricity transmission assets. Under the regime that applies to offshore wind farms in Britain’s territorial waters, although generators can elect for a separate offshore transmission owner (OFTO) to construct the necessary transmission assets, to date, all UK offshore wind generators have constructed their own offshore transmission assets (known as Generator Build). However, ‘unbundling requirements’ (introduced in the UK through the Electricity and Gas (Internal

Summary of key reporting obligations This Practice Note considers a variety of tax and regulatory regimes which require the trustees, or in some cases, the settlor or advisor, of a non-UK resident trust to provide information about the trust to a UK public body. This Practice Note does not deal with reporting requirements imposed by the US Foreign Account Tax Compliance Act (FATCA), the Common Reporting Standard (CRS), the Mandatory Disclosure Rules (MDR) legislation which replaced the regime under the Retained Directive 2018/822 also known as DAC6, the UK-Switzerland Tax Co-operation Agreement and the Worldwide Disclosure Facility. For information on these topics, see the Offshore tax evasion (and private client) sub-topic. See also the following Practice Notes: • FATCA and UK Trusts • Automatic exchange of information—the Common Reporting Standard: a summary • Disclosable cross-border tax arrangements—Mandatory Disclosure Rules (MDR) • Disclosable cross-border tax arrangements—DAC 6 [Archived] • UK-Switzerland Tax Co-operation Agreement [Archived], and • Worldwide Disclosure Facility Income tax compliance ITA 2007, s 748 gives HMRC the 'power to obtain information' in cases

Private Client analysis: Extra-statutory concession B18 sets out reliefs and exemptions which a beneficiary can claim when they receive an income distribution from a UK resident trust. In particular, where a non-UK resident beneficiary receives a distribution which is paid out of trust income, they can claim an exemption if the income would not have been taxable if received by the beneficiary directly. However, this concession only applies to the extent that the distribution is made out of income which arose to the UK resident trustees in the same year, or in one of the preceding five tax years. The original version of ESC B18 was first published in 1978. In 1994, an updated version was published which included additional concessions applicable in respect of discretionary offshore trusts. ESC B18 was updated again in 1999. Under the 1999 iteration, one of the concessions provides that, where a UK resident beneficiary receives a distribution made out of income which has arisen to an offshore discretionary trust, he or she can claim a credit in respect of UK income tax which has already been paid on that income by the trustees. Importantly, in this part of ESC B18 there is no express reference to any six-year limitation. Following some uncertainty, the Court of Appeal has now held that the six-year time limit does not apply to this particular concession. Written by Andrew Goldstone, partner at Mishcon de Reya LLP and Jon-Selous Borlace, barrister at Old Square Tax Chambers.

This Deed is made on [date] Parties 1 [insert name] of [insert address] and [insert name] of [insert address] (the Trustees) and 2 [insert name] of [insert address] and [insert name] of [insert address] (the Appointor) Background (A) This deed is supplemental to: (i) a trust (the Trust) dated [insert date] and made between [insert name] and [insert name] and [insert name] (the Trust Deed) and (ii) the deeds and events described in the Schedule.

This Deed is made on [date] Parties 1 [insert name] of [insert address] and [insert name] of [insert address] (the Retiring Trustees) and 2 [insert name] of [insert address] and [insert name] of [insert address] (the New Trustees) Background (A) This Deed is supplemental to: (i) a trust (the Trust) dated [insert date] and made between [insert name] (1) and [insert name] and [insert name] (2) (the Trust Deed), and (ii) the deeds and events described in Schedule 1 (B) The Retiring Trustees are the present trustees of the Trust. (C) The

This Deed is made on [date] Parties 1 [insert name] of [insert address] and [insert name] of [insert address] (the Trustees) and 2 [insert name] of [insert address] and [insert name] of [insert address] (the Appointor) Background (A) This Deed is supplemental to: (1) a trust (the Trust) dated [insert date] and made between [insert name] and [insert name] and [insert name] (the Trust Deed) and (2) the deeds and events described in [the] the Schedule. (B) The Trustees are the present trustees of the Trust. (C) The

This Deed is made on [date] Parties 1 [insert name] of [insert address] and [insert name] of [insert address] (the Trustees) and 2 [insert name] of [insert address] (the Appointor) Background (A) This Deed is supplemental to: (i) a trust (the Trust) dated [insert date] and made between [insert name] and [insert name] and [insert name] (the Trust Deed) and (ii) the deeds and events described in [the] the Schedule. (B) The Trustees are the present trustees of the

This Deed is made on [date] Parties 1 [Insert name] of [insert address] and [insert name] of [insert address] (the Appointor); 2 [Insert name] of [insert address] and [insert name] of [insert address] (the Outgoing Trustees); and 3 [Insert name] of [insert address] and [insert name] of [insert address] (the New Trustees). Background (A) This Deed is supplemental to: (i) a trust (the Trust) dated [insert date] and made between [insert name] (1) and [insert name] and [insert name] (2) (the Trust Deed), and (ii) the deeds and events described in Schedule 1 (B) The Outgoing Trustees are the present trustees of the Trust.

This Practice Note considers the effects of TCGA 1992, s 86 and Sch 5, which attribute gains of a non-resident settlor-interested trust to its settlor. Prior to 1991, there was no attribution of either income or gains of any settlement to the settlor unless he or his spouse were actual or potential beneficiaries or enjoyed a benefit. The Finance Act 1991 attributed the gains of certain offshore settlements to the settlor. In 1998, the categories of settlement caught by the 1991 legislation was enlarged by further legislation. Now TCGA 1992, s 86 applies to all settlements except 'protected TCGA 1992, settlements' and 'grandchildren settlements'. The tainting rules now only apply to determine whether 'protected settlements' and 'grandchildren settlements' are caught by TCGA 1992, s 86. See Practice Note: Offshore trusts—attribution of gains to settlors—tainting of protected settlements and grandchildren settlements. TCGA 1992, s 86 is more severe than the Transfer of Assets Abroad Code contained in Chapter 2, Part 13 of the Income Tax Act 2007 (ITA 2007) (see Practice Note: Transfer of

STOP PRESS: Abolition of non-dom regime and introduction of residence-based IHT regime Finance Act 2025 (FA 2025) which received Royal Assent on 20 March 2025, implements legislation to abolish the remittance basis of taxation and replace it with a residence-based regime, commencing on 6 April 2025. FA 2025 also replaces domicile as the key factor in establishing liability to inheritance tax. Other changes include amendment of the rules determining excluded property status, the abolition of protected settlements status of offshore trusts, and changes to overseas workday relief. For information on these changes, see Practice Notes: The abolition of the remittance basis of taxation from 2025–26 and A new residence-based regime for IHT from 2025–26. See also: Finance Bill Tracking Service: Key dates (Finance Bill 2025) and Finance Act 2025. Under section 86 of the Taxation of Chargeable Gains Act 1992 (TCGA 1992) where a UK resident settlor has an 'interest' in a trust and the trust is 'qualifying' for the purposes of the section, gains

This Practice Note considers the provisions of part 5, sections 619–648 of the Income Tax (Trading and Other Income) Act 2005 (ITTOIA 2005) (Ch 5) (referred to here as the ‘settlements code’) which deems the income arising under the settlement to be that of the settlor. It can apply to both onshore and offshore settlements. The Offshore trust avoidance—attribution of gains to settlors Practice Note discusses the capital gains tax (CGT) provisions which seek to attribute gains arising under a settlement to the settlor. The settlements code charges income tax to the settlor on: • income arising under a settlement where the settlor retains an interest in the settlement • income of a settlement paid to the settlor's minor child, or • certain capital payments (including loans) made to the settlor However where there is no element of bounty, ie no gratuitous transfer, and the arrangements are made for bona fide commercial reasons, a settlement may fall outside the settlements code (eg an employee benefit trust). See the outcome of the case Chinn