The UK and the Isle of Man (long regarded by HMRC as an offshore tax haven) have signed a US-style FATCA-type tax information sharing agreement. It means that the UK and the Isle of Man will automatically exchange information about their citizens’ bank accounts and other financial dealings.
This new agreement follows a similar agreement with America to implement the US Foreign Accounts Tax Compliance Act (FATCA). The USA is now looking to get agreements with 50 other countries shortly. Meanwhile the UK is seeking similar agreements with all its Crown Dependencies (e.g. the Isle of Man and the Channel Islands) and Other Territories. Complete global tax information sharing seems to be getting ever closer. Isle of Man chief minister Allan Bell said: “The nature of tax cooperation is changing and automatic exchange is becoming the global standard”.
David Gauke, the Exchequer Secretary to the Treasury said “Automatic information exchange is an important tool in boosting HMRC’s ability to clamp down on those who seek to hide their money overseas. Our ground breaking agreement with the US sets a new standard in international tax transparency and today’s agreement between the UK and Isle of Man to move to much greater levels of automatic exchange is the next step in this process.”
In a joint statement issued last month, the tax authorities in Jersey and Guernsey said they were also holding discussions about a similar agreement with the UK. The objective is for HM Revenue & Customs (HMRC) to get its hands on offshore bank account and asset information which it believes will be the clues to uncovering large scale tax evasion.
Last week, the Government announced £77 million of additional funding for HMRC to increase its anti- tax avoidance and anti- tax fraud work. HMRC is to create a “centre of excellence” to lead its work on offshore tax dodging, and develop a “comprehensive strategy” to tackle offshore tax evasion by spring 2013.
What does this mean for me?
If you have a bank account or other financial institution account in the Isle of Man, Jersey, Guernsey or Sark, and undeclared UK tax liabilities – then the likelihood is that HMRC will be given your details in the near future. In order to avoid prosecution and swingeing penalties now may be the time to consider making a full, voluntary disclosure to HMRC. You still have until 2016 to take advantage of HMRC’s generous tax amnesty, known somewhat confusingly as the Liechtenstein Disclosure Facility. This is open to anyone with offshore accounts; and there need not be any prior link to Liechtenstein.
How can Lynam Tax disclosure experts help me?
Lynam Tax experts have an enormous amount of experience in dealing with UK taxpayers with offshore bank accounts. We are already helping a large number of people obtain optimum outcomes using the various tax amnesties, such as the Swiss Tax Agreement and the Liechtenstein Disclosure Facility.
For a free, wholly confidential, and no commitment discussion: telephone Paul Lynam now on: 0845 643 9997