The Worldwide Disclosure Facility is HMRC’s permanent online portal for voluntarily disclosing undisclosed offshore tax. Using it correctly, before HMRC opens a formal investigation, can reduce your penalty by hundreds of percentage points compared with waiting for HMRC to act. Here is how the process works.
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What the WDF is
The Worldwide Disclosure Facility is HMRC’s permanent online portal, accessed via Gov.uk, through which UK taxpayers can voluntarily disclose undisclosed offshore income, gains, assets and liabilities. It launched in September 2016, replacing a series of earlier targeted offshore campaigns including the Liechtenstein Disclosure Facility (LDF), the Crown Dependencies campaigns (Jersey, Guernsey and Isle of Man) and the Swiss-UK Tax Agreement.
Unlike those earlier schemes, the WDF does not offer special penalty rates below the statutory minimum. It is not a concession, it is simply the mechanism through which voluntary offshore disclosure is made. The benefit comes from the timing and quality of the disclosure, not from the facility itself granting reduced penalties.
Who can use the WDF
The WDF is available to any UK taxpayer with undisclosed offshore tax liabilities, including:
- Individuals , UK residents with undisclosed foreign income, capital gains or assets
- Trustees , offshore trusts with UK-resident settlors or beneficiaries who have undisclosed tax obligations
- Companies , UK-resident companies with undisclosed offshore income or gains
- Partnerships , where individual partners have offshore liabilities arising from partnership activities
There is no minimum amount threshold. A taxpayer with a small undisclosed foreign savings account can use the WDF just as readily as someone with a multi-million-pound offshore structure.
Who cannot use the WDF
The WDF is not available to everyone. You are excluded if:
- HMRC has already opened a formal investigation into the same offshore matter, for example, under s9A TMA 1970 or via a discovery assessment, at the time you attempt to register your disclosure
- You have already received a formal enquiry letter specifically addressing the offshore non-compliance you wish to disclose
- The liability you wish to disclose has already been assessed by HMRC
Importantly, having received a nudge letter does not exclude you from using the WDF. A nudge letter is a non-statutory compliance check, it is not a formal enquiry opening. However, the window between a nudge letter and formal escalation can close quickly, so acting promptly is essential.
For a detailed explanation of HMRC nudge letters, see our guide: HMRC Offshore Nudge Letters: What They Mean and What to Do.
The notification stage
The WDF process begins with a notification. You (or your adviser on your behalf) register an intent to disclose on the Gov.uk WDF portal. This gives you a fixed period, typically 30 days from the date of registration, to prepare and submit the full disclosure.
The notification is important because it establishes the date on which you signalled your intention to come forward. If HMRC sends a formal enquiry letter after you have notified (but before you have submitted the full disclosure), HMRC’s guidance indicates it will generally allow the disclosure to proceed, because you had already taken the first step voluntarily.
If you received a nudge letter setting a 30-day response window, registering a WDF notification promptly is the appropriate response. It demonstrates engagement and starts the clock for your disclosure period.
Calculating the disclosure
The WDF calculation requires you to determine and declare the following for every year in which there is an undisclosed offshore liability:
- Tax: income tax, capital gains tax, National Insurance contributions, inheritance tax, stamp duty land tax or corporation tax, whatever taxes are applicable. The calculation must cover every relevant tax head for each affected year.
- Interest: statutory late payment interest from the date each amount of tax was originally due. HMRC’s current interest rates make this a material figure for older years.
- Penalties: calculated using the FA 2015 Schedule 20 offshore framework, taking account of the territory category, behaviour and whether the disclosure is unprompted or prompted.
The 20-year lookback
For offshore matters, HMRC is entitled to assess tax going back up to 20 years where behaviour was deliberate. For careless behaviour the position is generally 12 years for offshore matters (extended from the standard 4-year and 6-year domestic rules). In practice, most WDF disclosures cover at least the last 6 tax years and advisers routinely calculate exposure for the full 20-year period wherever there is any risk of a deliberate behaviour finding.
Penalty reduction under the WDF
Under the FA 2015 Schedule 20 regime, penalties are reduced by reference to the quality of the disclosure, specifically, how much the taxpayer:
- Tells HMRC: providing a full and accurate account of what happened (up to 30% of the maximum available reduction)
- Helps HMRC: providing calculations, working papers, explanations and documents in a way that enables HMRC to verify the figures (up to 40%)
- Gives access: making records, systems and relevant third parties available to HMRC (up to 30%)
A WDF disclosure that scores maximum across all three categories, combined with an unprompted classification, achieves the lowest possible offshore penalty. This is why the quality of a professional disclosure report matters enormously: a well-presented, comprehensive disclosure that pre-empts HMRC’s questions routinely achieves materially lower penalties than a bare-minimum submission.
Submission and payment
Once the calculation is complete, the disclosure is submitted via the Gov.uk WDF portal. The submission includes:
- A declaration of the total tax, interest and penalties due
- A breakdown by tax year and by tax head
- Supporting information to enable HMRC to verify the figures
Payment of the full amount declared is expected simultaneously with submission or shortly thereafter. HMRC does not typically accept a WDF disclosure if payment is not made alongside it or within an agreed very short timescale. If you genuinely cannot pay the full amount, you should discuss a time-to-pay arrangement with HMRC before submitting or immediately after. Interest continues to accrue on unpaid amounts.
On acceptance of a complete and accurate disclosure, HMRC issues a certificate of disclosure confirming that the matter is settled for the periods disclosed.
After submission
Submitting a WDF disclosure does not automatically close the matter. HMRC retains the right to:
- Verify the figures in the disclosure against data it holds (including CRS and FATCA data)
- Ask questions about specific entries or calculations
- Open a further enquiry if it believes the disclosure is incomplete or inaccurate
What triggers a post-submission enquiry? Most commonly, it is a discrepancy between the disclosure and HMRC’s own data, for example, CRS data showing a higher account balance than the one disclosed or income records that do not match the declared figures. This is why completeness and accuracy are so important: an incomplete WDF disclosure that HMRC later expands into a full investigation loses most of the penalty benefit of the original disclosure.
Once HMRC accepts the disclosure as complete and accurate, issues the certificate and the payment is received, the matter is treated as finally settled for the disclosed periods. HMRC cannot generally re-open those years for the same matters.
Frequently asked questions
How far back does a WDF disclosure go?
For offshore matters, HMRC can assess tax going back up to 20 years where behaviour was deliberate. For careless behaviour, the offshore lookback is generally 12 years. In practice, advisers recommend calculating exposure for the full 20-year period in any case where deliberate behaviour cannot be ruled out. See our guide on offshore assets and HMRC investigations for more on the assessment time limits.
What if I can’t afford to pay the tax owed?
Do not delay your disclosure on grounds of affordability, the penalty consequences of delay will typically worsen your overall financial position. Once you have submitted your WDF disclosure, it is possible to negotiate a time-to-pay arrangement with HMRC. HMRC’s Business Payment Support Service can agree instalment plans. Interest continues to run on the outstanding amount, but this is preferable to escalating penalties from failing to disclose at all.
Will HMRC prosecute me if I use the WDF?
In practice, making a complete and honest voluntary disclosure through the WDF substantially reduces the risk of prosecution. HMRC’s policy is not to prosecute where a taxpayer makes a full disclosure before HMRC has gathered sufficient evidence for prosecution proceedings. The WDF does not carry the explicit contractual immunity from prosecution that Code of Practice 9’s Contractual Disclosure Facility provides. If you are concerned about prosecution risk, specialist legal advice is strongly recommended before submission.
Can a company or trust use the WDF?
Yes. The WDF is available to individuals, trustees, companies and partnerships. Trustees should consider whether beneficiaries also have separate UK tax obligations arising from offshore trust distributions. Companies should consider all relevant tax heads including corporation tax, VAT and employer NIC obligations. The calculation and documentation requirements are the same regardless of entity type.