A part amnesty is being offered to people who have dodged tax by moving funds into offshore bank accounts.

Those brave enough to own up to tax evasion will pay back taxes with interest added and 10% of the tax owed. But if recalcitrants do not come forward they will be liable to a full Revenue & Customs investigation and a fine equivalent to 100% of the tax owed.

The Revenue has details on thousands of accounts held offshore in locations such as the Isle of Man and the Channel Islands and is determined to stop people using them to evade UK tax illegally.

“There are some seriously dodgy people who use offshore bank accounts,” said a source in the City who refused to be named.

“The very last thing they would want is Revenue & Customs poking about in their financial affairs and uncovering all sorts of chicanery that is better left in the shadows. In short, it’s worth their while to come clean.”

A Revenue spokesperson said: “People must come forward now. Failure to come forward will mean that we will go into full enforcement mode.”

Chas Roy-Chowdury, head of taxation at the Association of Chartered Certified Accountants, said: “People would be well-advised to come forward now and take advantage of the amnesty. Any investigation may prompt uncomfortable questions.”