UK and International Tax news

HMRC Disclosure Facility With Isle Of Man

Friday 22nd February 2013

HMRC has recently signed a Memorandum of Understanding with the Isle of Man which establishes a new disclosure facility [DF]. This will allow investors with accounts in the Isle of Man to come forward and settle outstanding tax liabilities.

Under the terms of the Memorandum of Understanding, HMRC will from 6 April 2013 until 30 September 2016 make available a bespoke scheme to persons eligible to participate in it and assist those persons in complying with their obligations to HMRC.

To support the objectives of the DF, the IOM Government will require financial intermediaries to contact relevant persons to advise them of the DF before 31 December 2013, to remind them about the DF during the six month period ending 30 September 2016, and to ensure adherence to legislation for the prevention on money laundering.

HMRC and the IOM Government have agreed to provide, through a joint declaration, exchange of letters, issuance of FAQs and answers, written guidance on IOM investment and wealth management structures and their treatment as a general matter by HMRC, with a view to providing clarification to relevant persons investing in the IOM.

Any tax withheld under the Agreement between the UK and the IOM providing for measures equivalent to those laid down in the EU Savings Directive will be creditable and credited against any UK tax due under the DF.

The obligations of an eligible person to report any interest in relevant property to HMRC and to account for any UK tax in relation to it will be treated as satisfied only if full and unprompted disclosure is made in respect of the relevant property and full UK tax, interest and applicable penalties are paid thereon.

HMRC may amend or withdraw the DF by giving three months notice to the IOM Government.

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