Jersey signs up to automatic exchange of tax information with the UK
05 November 2013
You may be aware that that Jersey has now signed an intergovernmental agreement on the automatic exchange of tax information (IGA) with the UK Government. This is an extension of the Tax Information Exchange Agreement (TIEA) between Jersey and the UK signed in 2009 which, although authorised the automatic exchange of information, had only been exercised for specific requests.
The IGA is modelled on similar agreements being negotiated with the United States (US) relating to compliance with provisions of the Foreign Account Tax Compliance Act (FATCA) brought into law in the US on 18th March 2010, and it is understandable why the UK government should wish to see similar levels of exchange between Jersey and the UK as between Jersey and the US.
The IGA requires any Jersey Financial Institution to report certain information to identify any Specified Person (broadly, any person or entity resident in the UK for tax purposes) who is an account holder, together with specified account information. However, unlike the proposed US IGA, the IGA contains details of an alternative reporting regime for UK resident, non-domiciled, remittance-based tax payers.
We will be contacting all clients who fall into the definition of a Specified Person with further information of what the automatic exchange entails.
The IGA is just one of a number of international commitments made by the Jersey in recent months to improve tax transparency. As part of the negotiations with the UK, a voluntary Disclosure Facility has also been agreed, the terms of which were set out in a Memorandum of Understanding earlier this year, click here to read. The Disclosure Facility allows relevant eligible investors with assets in Jersey to regularise any past tax affairs prior to information on their accounts being automatically exchanged.
The disclosure facility was made available on 6 April 2013 and is scheduled to expire on 30 September 2016.
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