Britain and the Panama Papers: What you need to know

LONDON -- A huge leak of millions of documents from Panamanian law firm Mossack Fonseca has shone a light on secret offshore holdings from 128 politicians and public officials across the globe, including the UK.

Dubbed the Panama Papers, the year-long investigation into the rich and the powerful has named former Tory Members of Parliament, party donors and Prime Minister David Cameron's late father. 

While dealing with offshore business is not illegal, the massive leak is likely to raise ethical questions over tax avoidance.

What's Britain's response to the revelations?

HM Revenue and Customs has said it's poised to launch an investigation into allegations of tax avoidance in the UK.

"HMRC can confirm that we have already received a great deal of information on offshore companies, including in Panama, from a wide range of sources, which is currently the subject of intensive investigation," HMRC director-general of enforcement and compliance Jennie Grainger told PA.

"We have asked the ICIJ to share the leaked data that they have obtained with us. We will closely examine this data and will act on it swiftly and appropriately.

"Our message is clear: there are no safe havens for tax evaders and no-one should be in any doubt that the days of hiding money offshore are gone. The dishonest minority, who can most afford it, must pay their legal share of tax, like the honest majority already does."

How is Britain connected to these tax havens? 

Mossack Fonseca, the world's fourth biggest provider of offshore services, has acted for more than 300,000 companies, of which more than a half are registered in British-administered tax havens, as well as in the UK itself, the International Consortium of Investigative Journalism reported.  

Those tax havens include the British overseas territories of the Virgin Islands and the British crown dependencies Guernsey, Jersey and the Isle of Man. British territories are parts of the former British empire that have not chosen independence or have voted to remain British territories. 

Crown dependencies are independently administered jurisdictions which are not part of the UK or British Overseas Territories.

Who are the British officials involved?

Six members of the House of Lords, three former Conservative MPs and "dozens" of donors to UK political parties are among those who've had offshore assets, according to the Guardian. 

The investigation confirms earlier reports that Cameron's late father, Ian Cameron, was a client of Mossack Fonseca. A stockbroker and multimillionaire, Ian Cameron helped create and develop Blairmore Holdings Inc. in Panama in 1982 and was involved in the investment fund until his 2010 death.

He left a fortune of £2.74 million ($3.89 million) in his will, from which David Cameron received the sum of £300,000 ($426,133). His dealings were revealed four years ago in a Guardian investigation. 

Other British officials implicated in the leak are Baroness and lifetime House of Lords peer Pamela Sharples; former Conservative Party donor and pollster Michael Ashcroft and former Tory MP Michael Mates. 

A spokesman for Ashcroft, who is named because a subsidiary of his company apparently worked with Mossack Fonseca in Belize, told Politics Home that allegations against him were “entirely false”. Lord Mates also told Politics Home his holdings in Caribbean property firm were not of “any value”.

The Labour Party's shadow chancellor John McDonnell has urged the HMRC to launch an investigation into the offshore account leak:

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What has Britain done to combat tax havens?

Since 2012, Cameron has spoken about being at the forefront in the push against tax havens, claiming he wants to end "tax secrecy' in the UK. At the time he told Channel 4 News' Political Editor Gary Gibbon that tax avoidance schemes were not "morally right". 

"Frankly some of these schemes where people are parking huge amounts of money offshore and taking loans back to minimise their tax rates, it is not morally acceptable," he said.

In 2013, Cameron asked G8 leaders to "shine a spotlight on who owns what and where money is really flowing". 

Cameron is expected to host a major summit to discuss offshore issues in London in May. 

In June, the government will introduce a new central register setting out real owners of a UK company - even though their name may not appear on the shareholder register. The database wants to extend the principle to tax havens abroad.

Cameron has yet to comment on the document leak. 

His spokesperson told ITV News: "That is a private matter, I am focused on what the government is doing."

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