Do I have to make a disclosure to both the IRS and HMRC?

Only where both are owed something. If your unreported income was always declared on your UK returns and the failure was purely on the US side, an IRS route alone is correct. If offshore income was also omitted from UK Self Assessment returns, HMRC's Worldwide Disclosure Facility is engaged as well. Because the UK and US exchange account information under the intergovernmental agreement first signed on 12 September 2012, a correction made on one side while the other stays uncorrected is visible to both authorities.

What is the difference between the Streamlined Foreign and Streamlined Domestic procedures?

Both require non-willful conduct. The foreign route requires that in at least one of the most recent three years you had no US abode and were physically outside the United States for at least 330 full days, and it carries no failure-to-file, failure-to-pay, accuracy-related, information return or FBAR penalties on the amounts reported. The domestic route applies where that non-residency test is failed, requires that returns were already filed for each of the three years, and carries a miscellaneous offshore penalty of 5 percent of the highest aggregate year-end value of the foreign financial assets subject to the penalty across the covered return and FBAR periods.

Does HMRC's Worldwide Disclosure Facility protect me from prosecution?

No. GOV.UK guidance states that you may still be liable to criminal prosecution, and the facility offers no special terms or guaranteed reduction. The route that carries protection is the Contractual Disclosure Facility under Code of Practice 9, where HMRC contracts not to open a criminal investigation into the conduct disclosed in return for a complete, accurate, open and honest disclosure. That protection is conditional and falls away if the disclosure proves incomplete.

How does extra UK tax from a disclosure affect my amended US returns?

Additional UK tax paid on income that also appears on the amended US returns changes the creditable foreign tax for those years, which can materially reduce the US tax payable with a streamlined package. That is why the UK liability should be modelled before the US computations are finalised. If the UK figure is later agreed at a different amount, that is a foreign tax redetermination with its own US reporting consequences under IRC section 905, so the US position may need revisiting even after the streamlined package has been filed.

What happens if the IRS or HMRC contacts me before I disclose?

Eligibility narrows on that side. A US voluntary disclosure is only timely if it arrives before the IRS has begun a civil examination or criminal investigation, received third party information about your non-compliance, or acquired information from a criminal enforcement action, and streamlined eligibility ends once the IRS makes contact. On the UK side an HMRC nudge letter does not close the Worldwide Disclosure Facility, but it turns the disclosure from unprompted into prompted, which raises the minimum penalty range. Contact from one authority does not close the routes available with the other.

Offshore Disclosure Options: US Investors in the UK

Q: Can I still use the Delinquent FBAR Submission Procedures to file late FBARs penalty free?

No. The IRS page hosting the Delinquent FBAR Submission Procedures no longer resolves, and the IRS page listing offshore compliance options, updated on 30 June 2026, names only the Criminal Investigation Voluntary Disclosure Practice, the streamlined filing compliance procedures and the delinquent international information return submission procedures. Commentary places the withdrawal at around 1 July 2026. The IRS FBAR page now describes late filing as a violation that may attract penalties and advises filing as soon as possible to keep any penalty to a minimum, so late FBARs should be filed promptly with a documented reasonable cause position rather than under a named relief programme.

Offshore disclosure options for a US investor living in the UK sit in two separate systems that do not talk to each other, and the right answer almost always involves both. On the US side the live routes are the Streamlined Foreign Offshore Procedures, the Streamlined Domestic Offshore Procedures, the IRS Criminal Investigation Voluntary Disclosure Practice, the delinquent international information return submission procedures, and plain back filing. On the UK side the main route is HMRC's Worldwide Disclosure Facility, with the Contractual Disclosure Facility reserved for admitted fraud. One route that competitors still list has gone: the IRS has withdrawn its Delinquent FBAR Submission Procedures.

This comparison is written for the fact pattern we see most often: a US citizen or green card holder who has been UK resident for several years, whose employment income has always been taxed correctly through PAYE, but who holds UK or Channel Islands investment accounts that were never reported to the IRS and, sometimes, offshore income that never reached a UK Self Assessment return either. That person is exposed on both sides of the Atlantic at once, and the sequencing of the two corrections matters as much as the choice of route.

What is an offshore disclosure, and which routes exist in 2026?

An offshore disclosure is a voluntary correction of unreported foreign income, foreign accounts or foreign entity filings, made under a published procedure before the tax authority makes contact, in exchange for defined and predictable penalty treatment. The trade is always the same: you give up the chance that nobody notices, and in return you get certainty about the consequences.

The routes currently available to a US person who is UK resident are these.

Streamlined Foreign Offshore Procedures. The US route for a taxpayer whose failures were non-willful and who meets the non-residency test. No failure-to-file, failure-to-pay, accuracy-related, information return or FBAR penalties on the amounts reported.
Streamlined Domestic Offshore Procedures. The same non-willful standard, but for a taxpayer who fails the non-residency test. Carries a 5 percent miscellaneous offshore penalty.
IRS Criminal Investigation Voluntary Disclosure Practice. The route where the conduct was willful and criminal exposure is the concern.
Delinquent international information return submission procedures. A narrow route for a taxpayer whose only gap is unfiled international information returns, with reasonable cause asserted return by return.
Plain amended or back filing. No published protection, no certification, and no penalty framework agreed in advance.
HMRC Worldwide Disclosure Facility. The UK route for any UK tax liability that relates wholly or partly to an offshore issue, run through the Digital Disclosure Service.
HMRC Contractual Disclosure Facility under Code of Practice 9. The UK route where deliberate conduct is admitted and protection from criminal investigation is the objective.

Which offshore disclosure options did the IRS withdraw?

The Delinquent FBAR Submission Procedures have gone. The IRS page that hosted them no longer resolves, and the IRS page titled Options available for US taxpayers with undisclosed foreign financial assets, last updated on 30 June 2026, now names only three offshore compliance options: the Criminal Investigation Voluntary Disclosure Practice, the streamlined filing compliance procedures, and the delinquent international information return submission procedures. Commentary places the removal at around 1 July 2026.

This matters more than it first appears. The withdrawn procedure was the clean answer for the most common fact pattern in cross-border work: an investor whose income was correctly reported and whose tax was correctly paid, but who never knew the FBAR existed. That person no longer has a named, penalty-free path. The IRS FBAR page, last updated on 30 July 2026, now frames late filing as a violation that may attract penalties and advises filing as soon as possible to keep any penalty to a minimum. Civil FBAR penalty maximums sit in Title 31 of the United States Code and are adjusted annually for inflation, with a far higher ceiling where a violation is treated as willful. In practice that pushes more taxpayers towards a full streamlined submission, and makes the quality of the reasonable cause narrative far more important than it was a year ago.

Streamlined Foreign Offshore Procedures: the default route for a US investor in the UK

For a US citizen or green card holder genuinely living in the UK, the Streamlined Foreign Offshore Procedures are usually the strongest of the offshore disclosure options, because they are the only route that removes penalties rather than reducing them. The IRS states that an eligible taxpayer filing under these procedures will not be subject to failure-to-file and failure-to-pay penalties, accuracy-related penalties, information return penalties or FBAR penalties on the amounts reported.

Eligibility turns on two tests. First, the failures must have been non-willful, which the IRS defines as conduct due to negligence, inadvertence or mistake, or conduct resulting from a good faith misunderstanding of the law. Second, the non-residency requirement. For a US citizen or lawful permanent resident, that means that in at least one of the most recent three years for which the return due date has passed, the individual had no US abode and was physically outside the United States for at least 330 full days. Abode follows the IRC section 911 concept, so keeping a property in the United States does not by itself defeat the test, but the centre of your domestic life needs genuinely to be in the UK.

The submission package is prescriptive. It covers delinquent or amended returns for each of the most recent three years for which the return due date, or properly extended due date, has passed, and delinquent FBARs for each of the most recent six years for which the FBAR due date has passed. Form 14653, the certification for a US person residing outside the United States, must be signed and included, and its narrative statement of facts is the part the IRS actually reads. Returns go in on paper to the Austin service centre with the words Streamlined Foreign Offshore written in red at the top of the first page; electronic submissions are rejected. FBARs go in electronically through the FinCEN BSA E-Filing System, selecting Other as the reason and entering Streamlined Filing Compliance Procedures in the explanation box. Full tax and interest must be paid with the package.

Streamlined Domestic Offshore Procedures: when the 5 percent penalty bites

The domestic variant applies to a taxpayer who is non-willful but fails the non-residency test. For a client who moved to London part way through the relevant period, or who spent enough time back in the United States to break the 330-day count in every one of the three years, this is the route that applies whether they like it or not.

Two differences drive the outcome. The domestic route requires that the taxpayer already filed a US return, where one was required, for each of the most recent three years, so it works on amended returns rather than original delinquent ones. And it carries a miscellaneous offshore penalty equal to 5 percent of the highest aggregate year-end balance or value of the foreign financial assets subject to the penalty, measured across the years in the covered tax return period and the covered FBAR period: you compute the year-end aggregate for every year in both periods and take the single highest. Form 14654 certifies eligibility, non-willfulness and the accuracy of that computation. For a UK-based investor with a substantial brokerage account, the difference between qualifying as foreign and being pushed into domestic is not a technicality; it is 5 percent of the largest balance they ever held.

When does the Voluntary Disclosure Practice become the right route?

The IRS Criminal Investigation Voluntary Disclosure Practice is the route where the conduct cannot honestly be certified as non-willful. Signing Form 14653 or Form 14654 under penalties of perjury when the facts show deliberate concealment is a materially worse outcome than entering the Voluntary Disclosure Practice at the outset.

The process runs in two parts. Part I of Form 14457 is a preclearance request, submitted by fax to Criminal Investigation, which establishes eligibility but does not guarantee acceptance. Part II must then be submitted electronically within 45 days of preclearance. A disclosure is only timely if it arrives before the IRS has commenced a civil examination or criminal investigation, received information from a third party about the non-compliance, or acquired information from a criminal enforcement action. The Internal Revenue Manual sets the civil framework: the disclosure period is generally the most recent six tax years, a civil fraud penalty under IRC section 6663 or a fraudulent failure to file penalty under IRC section 6651(f) applies to at least one year and is asserted in the year with the highest deficiency, and FBAR violations within a voluntary disclosure are treated as willful. The IRS is explicit that a voluntary disclosure does not automatically guarantee immunity from prosecution, but may result in prosecution not being recommended.

One live caveat. The IRS has published proposed updates to the Voluntary Disclosure Practice which are in a public comment period, and it states that those proposals do not create rights or expectations for taxpayers who applied before the proposal is finalised. Anyone weighing this route in 2026 should confirm the terms in force on the date of the preclearance request rather than relying on a published summary.

The narrow US routes: delinquent information returns and back filing

The delinquent international information return submission procedures remain live, last updated on 19 April 2026. They apply to a taxpayer who is not under civil examination or criminal investigation and has not been contacted by the IRS, and who needs to file late information returns such as Form 5471 or Form 8938. A reasonable cause statement may be attached to each delinquent return, but be realistic about what that buys: the IRS states that penalties may be assessed in accordance with existing procedures, which in practice means a penalty can be assessed before anyone reads the statement, with reasonable cause considered afterwards on correspondence. Forms 3520 and 3520-A are the exception, where reasonable cause is considered before a penalty is asserted.

Plain amended or back filing, sometimes described as a quiet disclosure, is not a procedure at all. It offers no certification, no agreed penalty framework and no protection, and where a pattern of unreported offshore income is later examined, the absence of a disclosure narrative works against the taxpayer. It also runs into the ordinary refund limitation period, so amended years that would produce a refund may deliver nothing while the years that produce tax remain fully payable.

How do the UK offshore disclosure options compare?

HMRC's Worldwide Disclosure Facility is the UK counterpart, and its architecture differs in ways that catch US-trained practitioners out. GOV.UK guidance, last updated on 6 April 2026, states that anyone who wants to disclose a UK tax liability relating wholly or partly to an offshore issue can use the facility. That covers income arising outside the UK, assets held outside the UK, and activities carried on wholly or mainly outside the UK, as well as funds connected to undeclared UK tax that were moved abroad.

The mechanics are a two-stage process through the Digital Disclosure Service. You notify HMRC first and receive a disclosure reference number. From that point you have 90 days to gather the information, calculate the liabilities and submit the disclosure, and a requirement of the facility is that you make an offer for the full amount due. The 90 days is a hard operational deadline and it is short for a cross-border case, which is why the analysis should be substantially complete before you notify.

No immunity. GOV.UK is clear that you may still be liable to criminal prosecution. The Worldwide Disclosure Facility does not offer special terms or a guaranteed penalty reduction.
Behaviour drives the number of years. The disclosure period reflects self-assessed behaviour, broadly four years for careless conduct, six years for non-deliberate failures and twenty years where conduct was deliberate. Finance Act 2019 also extended the assessing time limit for offshore matters to twelve years in non-deliberate cases.
Offshore penalties are geared by territory. HMRC factsheet CC/FS17 sets maximum offshore penalties of 100 percent of the tax for Category 1 territories, 150 percent for Category 2 and 200 percent for Category 3, with HMRC publishing the categorisation of each territory.
Unprompted beats prompted. Coming forward before HMRC contacts you produces a materially lower penalty range than disclosing after a nudge letter lands.
Rejection has consequences. If HMRC cannot accept the disclosure it will open an enquiry, or resume an existing one, and pursue the information under its ordinary powers.

Where deliberate conduct is admitted, the Contractual Disclosure Facility under Code of Practice 9 is the UK equivalent of the Voluntary Disclosure Practice. It is a contract: the taxpayer commits to a complete, accurate, open and honest disclosure of all deliberate conduct, and in return HMRC commits not to open a criminal investigation into the conduct disclosed. There are 60 days to accept an offer of the facility, and the protection falls away if the disclosure turns out to be incomplete.

How a US and a UK disclosure interact when you need both

This is where most published guidance stops, and it is where the real risk sits. The two authorities run independent processes, but they see the same accounts. Under the UK and US intergovernmental agreement signed on 12 September 2012, the first of its kind, UK financial institutions report account data to HMRC which passes it to the IRS, and the agreement provides for reciprocal exchange in the other direction. A disclosure made on one side of the Atlantic while the other side is left uncorrected is not a private decision; it is a visible one.

Four interactions need managing deliberately.

The behaviour labels do not match. The US asks you to certify non-willful conduct under penalties of perjury. The UK asks you to self-assess behaviour as careless, non-deliberate or deliberate. Selecting deliberate on the UK disclosure to secure a cleaner UK settlement, while certifying non-willfulness to the IRS, creates two signed statements that are difficult to reconcile if either is ever tested.
Foreign tax credits move. Additional UK tax paid on income that also sits on the amended US returns changes the creditable foreign tax on those years. A US streamlined package finalised before the UK numbers are settled will usually need revisiting, and a later change to foreign tax paid is a foreign tax redetermination with its own US consequences under IRC section 905.
The tax years do not line up. The UK year runs from 6 April to 5 April, the US year is the calendar year. Every income figure has to be re-cut for the other jurisdiction, and every foreign currency amount translated on the correct basis, before the two packages can be reconciled to each other.
The narratives must agree. Form 14653 carries a statement of facts, and the Worldwide Disclosure Facility disclosure carries its own account of what went wrong and why. Two independently drafted stories about the same accounts is the single most avoidable error in a dual disclosure.

Worked scenario: a London investment banker with UK and Channel Islands accounts

Take a US citizen who relocated to London several years ago and has been UK resident and physically present in the UK ever since. Her employment income has always been taxed through PAYE and reported on her UK return, and she has filed US returns each year, but those returns omitted the dividends, interest and gains from a UK investment account and she never filed an FBAR. She also holds a Jersey deposit account whose interest never reached her UK Self Assessment return.

On the US side she comfortably meets the non-residency test, so the Streamlined Foreign Offshore Procedures apply. Her package is three amended returns picking up the investment income, with Form 8938 added and the UK funds analysed for passive foreign investment company treatment on Form 8621, six years of FBARs covering both the UK and Jersey accounts, Form 14653 with a properly evidenced narrative, and payment of the tax and interest due. No IRS penalties should attach to the amounts reported.

On the UK side the omitted Jersey interest is an offshore matter, so she notifies HMRC through the Digital Disclosure Service, assesses her behaviour honestly, and has 90 days to submit and make an offer. Her penalty range depends on that behaviour, on the territory category, and critically on the fact that she came forward unprompted rather than after a nudge letter.

The interaction is the part that changes the numbers. The additional UK tax she pays on the Jersey interest is UK tax on income that also appears on her amended US returns, so it feeds her US foreign tax credit computation for those same years. Finalising the US package before the UK liability is agreed would mean claiming a credit for tax she has not yet paid, or omitting it and overpaying the IRS. The UK computation therefore has to be modelled first, even if the US package is filed first.

Which offshore disclosure options fit which fact pattern?

Non-willful, UK resident, meets the 330-day and abode test, unreported foreign income: Streamlined Foreign Offshore Procedures, plus a Worldwide Disclosure Facility disclosure if any of that income was also omitted from UK returns.
Non-willful, but present in the United States too often to pass the non-residency test in any of the three years: Streamlined Domestic Offshore Procedures, accepting the 5 percent miscellaneous offshore penalty.
Income and tax always correct, the only gap is unfiled FBARs: there is no longer a named penalty-free IRS route, so file the late reports promptly with a documented reasonable cause position, and consider whether a full streamlined submission gives better certainty.
Income correct, but a missed Form 5471 or Form 8938: the delinquent international information return submission procedures, with a reasonable cause statement drafted on the assumption it may be read only after a penalty is assessed.
Conduct that cannot be certified as non-willful: the IRS Criminal Investigation Voluntary Disclosure Practice on the US side and the Contractual Disclosure Facility on the UK side, entered in a coordinated way.
Already contacted by the IRS or already holding an HMRC nudge letter: eligibility for the voluntary routes is narrowing on that side, and the priority is establishing exactly what each authority already knows before anything is filed.

Sequencing: which disclosure should go first?

Model both before you file either. The two processes have very different clocks. The HMRC 90-day window starts the moment you notify, and it does not pause while a US analysis is finished. The IRS streamlined submission has no filing deadline at all, but you carry full exposure for every day you wait, and eligibility ends the moment the IRS makes contact. The practical consequence is that you complete the UK computation, then notify HMRC, and run the US package alongside the 90 days rather than sequentially after it.

Two further points are worth holding on to. Eligibility closes independently on each side, so an HMRC nudge letter turns a UK disclosure from unprompted into prompted without affecting IRS streamlined eligibility, and IRS contact ends streamlined eligibility without affecting the Worldwide Disclosure Facility. And the record-gathering overlaps almost entirely: six years of account statements, fund holdings for the passive foreign investment company analysis, entity filings, evidence of days spent outside the United States, and the UK computations. Assemble that once, for both jurisdictions, and the two disclosures reconcile to each other by construction rather than by luck.

Comparing offshore disclosure options properly means comparing them as a pair rather than a menu. The IRS route determines your US penalty exposure, the HMRC route determines your UK penalty exposure, and the interaction between them determines what you actually pay after credits. Getting the choice right, and the order right, is a preparation and compliance exercise that rewards doing the arithmetic before anything is signed.