HMRC have renegotiated some of the terms of the Liechtenstein Disclosure Facility. One major change is the introduction of the new Confirmation Of Relevance.
The Liechtenstein Disclosure Facility (LDF) is a ground-breaking tax agreement between HM Revenue & Customs (HMRC) and the Government of Liechtenstein. It’s a unique time-limited opportunity to declare previously hidden tax liabilities to the taxman on highly advantageous terms, which have never previously been on offer. Confusingly for some, participation in this one true tax amnesty is not limited to those with a prior connection to Liechtenstein. By 30 September 1,721 UK residents had registered for the LDF. It is understood that the vast majority of them did not previously have a connection to Liechtenstein.
HMRC have renegotiated some of the terms of the so-called Memorandum of Understanding with the Liechtenstein government. One of the conditions for using the (LDF) in order to disclose unpaid tax is that you must already own or acquire qualifying assets in Liechtenstein. There has been some dispute with HMRC as to whether certain assets acquired in Liechtenstein were sufficient to qualify the UK resident to participate in the LDF. In order to overcome this uncertainty, financial institutions in Liechtenstein will now have to issue a certificate, known as a Confirmation Of Relevance, to anybody who acquires a qualifying asset in Liechtenstein. From 1 December 2011 without a Confirmation Of Relevance it will not be possible to register for the LDF.
This is an unusual and confusing area where specialist advice can be essential.
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