British holders of Swiss-based bank accounts are being urged to pay any tax due, or face an HMRC probe and potential penalties of up to 150% of the taxes owed.
That's the stark warning from HMRC, which is sending out its third tranche of letters to Swiss bank account-holders this week.
Jennie Granger, HMRC's director general, enforcement and compliance, said: 'The government has made £77m available to tackle the minority who refuse to play by the rules, so if you have been hiding money offshore to evade tax, it is only a matter of time before we find you. We are working carefully through the offshore data we have received and this work has so far brought in £100min unpaid tax that would otherwise have remained lost to the UK.
'The ground-breaking agreement between the UK and the Swiss Confederation which is about to come into force will bring in up to £5bn in tax revenue to the UK. We will use the technology, data and skills at our disposal to tackle those who engage in offshore evasion. The net is closing in.
"The people receiving the letter will not be offered any special opportunity. We are offering them this last chance to come forward voluntarily or face the consequences."
The UK/Swiss tax agreement will come into force on 1 January 2013.
From then on in, accounts held by individual UK taxpayers in Switzerland will be subject to a one-off deduction in 2013, as long as the account was open on 31 December 2010 and is open on 31 May 2013.
HMRC say the one-off deduction will settle income tax, capital gains tax, inheritance tax and VAT liabilities in relation to the funds in the account. The deduction will not be applied if the account-holder instructs the bank to disclose details of the account to HMRC. Following that disclosure, HMRC will seek unpaid taxes with relevant interest and penalties.
From the same date, any income and gains arising on investments held by individual UK taxpayers in Swiss banks will be subject to a new withholding tax. HMRC said the rates "will be very close to the top rates of UK tax".
Payment of the withholding tax will satisfy UK tax liabilities on the income and gains. Again, the withholding tax will not apply if the account-holder authorises disclosure of details of income and gains to HMRC and pays any associated taxes here.