The crackdown on offshore accounts widened last week to include customers of building societies, financial advisers and small private banks.

The Revenue met delegates from 170 institutions to discuss how best to encourage their customers to come forward.

It is the latest move in an attempt to claw back tax on the billions of pounds thought to be salted away in offshore accounts.

The taxman initially targeted customers with five high-street banks after obtaining details of 400,000 accounts following a court action. Of these, 100,000 were found to be “noncompliant” - in other words, the tax had not been properly declared. The Revenue offered people a partial amnesty in April, allowing for a flat 10% penalty on undeclared tax compared with the usual fines of up to 100%.

About 62,000 people came forward by the June 22 deadline. Disclosures ranged from a businessman who had diverted £1.3m to the Channel Islands, to a plumber who paid about £10,000 from informal jobs into an offshore account.

Here, we answer your questions on the crackdown.

Why are offshore accounts being targeted?

About 3m people in Britain have offshore bank accounts, mostly in places such as the Isle of Man, Guernsey and Jersey.

While it is legal for someone resident in the UK to have an offshore account, the interest must be declared on your self-assessment form and tax paid.

Some accountants believe the Revenue could raise up to £5 billion by raiding these accounts.

How did the taxman get information from banks?

It took five banks to court in 2005 to force them to disclose customer details, aided by European legislation.

The European Savings Directive, which came into force in the same year, allows EU governments to share details of people who hold accounts in one country, but reside in another. For example, the Revenue can get details of someone who lives in Britain with an account in France.

Singapore and Dubai have not signed up to the directive, and billions of pounds have been shuffled off to these countries recently, said Mike Warburton of accountants Grant Thornton.

Why has the crackdown been widened?

In April, a campaign was launched to encourage customers at Barclays, HSBC, HBOS, Royal Bank of Scotland and Lloyds TSB with offshore accounts to decalre their assets. The banks wrote to customers urging them to come forward.

As part of the amnesty, many people from other banks came forward voluntarily, so the Revenue is now extending its reach. It said: “The money that we have already received shows that there is clearly a lot more to come.”

Warburton added: “This is an inevitable progression from what happened earlier in the year.”

What now for customers of the big banks?

If they took advantage of the amnesty, they have a deadline of November 26 to pay the undeclared tax, the interest and any penalty. The Revenue is sending out reminder letters.

The remaining 40,000 who have not come forward face a tax probe and penalties of up to 100% of the tax they owe – though they may be able to reduce penalties if they own up soon. The taxman is starting investigations into these individuals.

How much has the taxman received already?

Of the 62,000 who have come forward, 15% have paid £100m.

I am with a smaller bank or building society, what should I do?

You are likely to get a letter encouraging you to come forward, but it may be worth coming clean before then.

If you come forward without being prompted and it is shown you have not sought to mislead the taxman, you may be let off or face a very small penalty.

The Revenue said: “If people come forward without being contacted by us, we’re far more likely to be pliable about the final penalty. If they don’t come forward, they will be subject to an inquiry, sooner rather than later, and they will end up paying a far heavier penalty. Even at this late stage, it is an important mitigating factor.”

How are penalties calculated?

Penalties will be judged on individual circumstances. The Revenue said: “It is a very different scenario between an elderly person who simply forgot about their tax affairs and a City banker who you would expect to be abreast of the law.”

The penalty figure will be a percentage of the tax underpaid or paid late. The taxman starts with a 100% penalty figure and then reduces this depending on mitigating factors.

A full voluntary disclosure before an investigation begins could reduce the penalty by up to 30%. Cooperation – supplying information quickly, answering questions honestly and accurately or attending interviews – can reduce the penalty by a further 40%. Another reduction of up to 40% can be achieved if the case is not deemed as “serious”. Money that is not disclosed will also incur interest at a much higher rate than normal. Currently this is set at 8.5%.

I was advised by my bank. Is this a defence?

The Revenue says that if your bank manager advised you to put money in an offshore account to avoid tax, you are still liable. However, you may be able to file a complaint with the Financial Services Authority for mis-selling.

Warburton said he has received a “sufficient enough number of inquiries” to suspect that some mis-selling was going on.

Banks are likely to fight back, though, so unless you have some written proof, you will still be ultimately liable.

Is it worth having an offshore account?

UK residents with offshore accounts benefit from something called “gross roll-up” – because tax is not due until nine months after the tax year (on the January 31 self-assessment deadline), you earn interest on your money for longer than if it was deducted at source, as it would with an onshore account.

Will there be any criminal prosecutions?

The taxman has said it will consider another partial amnesty, but it reserves the right to prosecute in the most serious cases, such as those involving false names or invoices. Professionals such as lawyers and accountants may also be prosecuted.

The first of these prosecutions is expected early next year.

A CRACKDOWN IN NUMBERS

3m: people estimated to have offshore accounts
400,000: accounts the Revenue has details of
100,000: accounts where tax had not been declared
62,000: people who came forward in the tax amnesty
9,300: account-holders who have already paid up
£100m: tax paid so far
£2m: the biggest disclosure of unpaid tax so far
£5 billion: the total that could be raised