Voluntary Disclosure to HMRC
The best time to act is before HMRC contacts you
If you believe you have not paid the right amount of tax in previous years, making a voluntary disclosure to HMRC is almost always the best course of action. We help you do it correctly, completely, and on the most favourable terms possible.
What Is a Voluntary Disclosure?
A voluntary disclosure is when you proactively tell HMRC about undeclared income, gains, or errors in your tax returns — before HMRC contacts you to investigate. It applies to all taxes, including Income Tax, Capital Gains Tax, National Insurance Contributions, Corporation Tax, VAT, and Inheritance Tax.
The key principle is simple: the earlier you come forward, the better your outcome. HMRC treats voluntary disclosures far more leniently than cases where non-compliance is discovered through investigation.
The Digital Disclosure Service (DDS)
Notify HMRC of your intention to make a disclosure via the DDS
Receive a unique Disclosure Reference Number (DRN) from HMRC
Within 90 days, calculate and submit your full disclosure — setting out the unpaid tax, interest, and penalties
Make payment. HMRC can agree a Time to Pay arrangement if needed
HMRC reviews and confirms acceptance of your disclosure
The disclosure must be complete and accurate. Any omissions can result in
HMRC reopening the matter and investigating further —
potentially leading to higher penalties and scrutiny of your entire tax history.
Penalty Savings — Why Voluntary Disclosure Matters
Unprompted voluntary disclosures can attract penalties as low as 0 to 10% of the unpaid tax
Prompted disclosures (after HMRC has made contact) attract higher penalties — typically 15 to 30%
If HMRC discovers the non-compliance through investigation, penalties can reach 100% of the tax owed
For offshore matters, penalties can rise to 200% or even 300% of the underpaid tax
HMRC can look back 4 years for innocent errors, 6 years for careless behaviour, and up to 20 years where there has been deliberate non-compliance. Getting your disclosure right — and complete — is critical.
What Can Be Disclosed Through the DDS?
Income Tax — including undeclared self-employment, rental, or investment income
Capital Gains Tax — including gains on property, shares, or other assets
National Insurance Contributions
Corporation Tax
Inheritance Tax
Annual Tax on Enveloped Dwellings (ATED)
Note: The DDS is not the right route for all situations. Offshore income, deliberate fraud, and certain sector-specific issues may require a different disclosure facility. We will always advise you on the correct route before proceeding.
How We Help
- We review your tax records and identify any areas of potential non-compliance
- We advise on the correct disclosure route for your circumstances
- We calculate your tax, interest, and penalty exposure accurately
- We prepare and submit your disclosure through the DDS
- We liaise with HMRC on your behalf throughout the process
- Where appropriate, we negotiate a Time to Pay arrangement to spread the cost
Speak to a Specialist Today
Our tax advisers have extensive experience in managing voluntary disclosures for individuals and businesses across a wide range of tax issues. Contact us for a free, confidential consultation.
Speak Before Responding
This is general information, not personalised advice. Please speak to an accountant for confirmation.
