Not words from the pen of an accountant but rather from one who has had more than a nodding acquaintance with them
If you were resident in the UK for tax purposes and received income paid overseas then this income should (presumably) have been declared on your UK income tax form. It is not for you to decide what tax you have to pay, rather the onus is on you to declare your world wide income and let the revenue determine your tax liability.
The standard letter has indeed been sent to everyone with an offshore bank account, following a very recent court case. The revenue will work their way through the list in an effort to reclaim billions of tax money which they perceive as being lost to them.
The amnesty deadline is a real threat line in the sand. Anyone who should have declared offshore income after this date and who has not done so will be penalised very heavily. This draconian attitude on the part of the revenue has come about, in part, because the revenue in the UK has been merged with customs and excise.
If you cannot prove that your employer paid tax on the income you received overseas, it is almost certain that the revenue will determine that no tax has been paid.
You would therefore be liable for UK income tax on this at your maximum rate, probably 40%?
Therefore your options are really quite clear.
Talk with an accountant.
Talk with the revenue themselves.
Write the revenue a letter, before the deadline, stating what you were paid and for why but explaining that you do not think that you are liable for tax on this money. This will at least provide disclosure and keep you clean of the charge of evasion.
Do nothing about it and probably worry about it quite a lot. Your chances of being eventually discovered are very high and probably not worth the powder to blow the matter to hell.
Budget 40% of what you received as what you will have to pay, as a minimum, if you come clean about it now.
Remember too, that if the revenue do get around to you, they may well examine all your tax affairs. Perhaps you once drew some money from this account and brought it into the UK? Even if you are non domiciled in England, you would be liable for income tax on that amount.
The revenue in England is becoming very much more like that in the USA. A little jingle from that part of the world tells one 'not to mess with the IRS'.
Hope that helps.
