The Worldwide Disclosure Facility (WDF) – what is it and should I be using it?

The Worldwide Disclosure Facility (WDF) is a vital resource for individuals and businesses looking to disclose offshore assets and income that were previously undisclosed to the tax authorities. As of 2023, it continues to play a crucial role in ensuring tax compliance. In this article, we’ll delve into what the Worldwide Disclosure Facility is, how it works, and how you can disclose to rectify your tax affairs.

What is the Worldwide Disclosure Facility (WDF)?

The Worldwide Disclosure Facility, often referred to as WDF, is a mechanism provided by HM Revenue and Customs (HMRC) to facilitate the disclosure of offshore tax liabilities and income. It is designed to allow individuals and businesses to come forward voluntarily and declare any previously undisclosed offshore assets and income to ensure they are compliant with tax regulations.

How Does the Worldwide Disclosure Facility Work?

In 2023, the WDF operates with a primary goal: to encourage individuals and entities to disclose any offshore income or assets that have not been previously reported. Here’s how it typically works:

• Eligibility: The WDF is open to a wide range of individuals and entities, including UK residents and non-residents, trusts, and companies.
• Disclosure Process: To make a disclosure, you’ll need to provide detailed information about your offshore assets, income, and any outstanding tax liabilities. This information is typically submitted to HMRC via their secure online portal.
• Penalties: By using the WDF, you can benefit from reduced penalties compared to if you were identified by HMRC through other means. The exact penalties depend on individual circumstances.
• Payment: After making your disclosure, you’ll need to settle any outstanding tax liabilities along with any applicable interest and penalties.

How to Use the Worldwide Disclosure Facility

To use the WDF in 2023, follow these steps:

• Gather Information: Collect all relevant details about your offshore assets and income, including bank accounts, investments, and any income generated from offshore sources.
• Access the Online Portal: Visit the official HMRC website and use their secure online portal to make your disclosure. You’ll need to provide accurate and comprehensive information about your undisclosed assets and income.
• Pay Any Tax Due: After your disclosure, you will receive details of the tax, interest, and penalties owed. Ensure you make the necessary payments promptly.

Why Use the Worldwide Disclosure Facility?

Using the WDF is a proactive step towards compliance with tax regulations. It helps individuals and businesses rectify their tax affairs, reduce potential penalties, and maintain transparency with HMRC.

Seek Professional Advice

While this article provides an overview of the Worldwide Disclosure Facility, tax regulations can be complex, and individual circumstances vary. Seeking professional advice from tax experts or legal advisors is highly recommended when considering the WDF. They can guide you through the process and help ensure you make a full and accurate disclosure.

Don’t hesitate to reach out to HMRC or consult with a tax professional for the most up-to-date information and personalized assistance regarding the Worldwide Disclosure Facility.

Andrew Haggard FCA

Andrew founded Haggards Crowther with his brother in 2004 and took over as Managing Partner in May 2023. He has always been closely involved in client work, in particular providing high level strategic tax and structuring advice, business advice and supporting the technical and compliance teams.

As Managing Partner, he has focussed on growing the business and ensuring the firm upholds its core values of Quality of Service, Innovation, Collaboration and Integrity. These remain central to all that we do both internally and in serving our clients.

A Fulham resident for over 30 years Andrew is closely connected with the local business community and supporting many of them on their journeys. He is especially linked with fellow start-up entrepreneurs advising them on their growth strategies and optimal structures.

A passionate Fulham FC supporter, along with his two sons, Andrew rarely misses a game. He plays and coaches volleyball, something he has done since university in Edinburgh, and which offsets another of his passions: exploring the vast and diverse range of food that London’s restaurants have to offer.

He has a keen interest in many conservation projects especially in protecting endangered species of birds and actively supports the Mabula Project in South Africa. This charity supports the Southern Ground Hornbill, a charismatic species of cultural and ecological importance threatened by loss of habitat through the encroaching development of the savannah.