Author: Chartered Accountants Ireland
The UK Government has recently signed
an agreement with the Isle of Man targeting those with offshore
accounts. Signed on Thursday 10 October, the agreement is the first ever
automatic tax information exchange agreement based on FATCA (the US
Foreign Account Tax Compliance Act) to be signed between two parties
outside of the US.
The UK government is calling this "a
significant move towards a new global standard in the automatic exchange
of tax information”.
The Government is seeking to sign
further agreements with other jurisdictions as soon as possible and is
currently in discussions with the remainder of the Crown Dependencies
and the Overseas Territories to do so.
A wide range of financial information on
UK taxpayers with accounts in the Isle of Man will now be reported to
HMRC automatically each year significantly enhancing HMRC’s ability to
close in on those who do not declare their offshore affairs.
Also recently announced, South Africa
and the UK have agreed to work together to tackle offshore tax evasion,
including through pressing for stronger international action. As a
result, South Africa will join the pilot scheme for the automatic
exchange of tax information launched by the United Kingdom, along with
France, Germany, Italy and Spain.
This initiative has received growing
support worldwide with a growing number of jurisdictions committed to
quickly implementing the new standard in the automatic exchange of tax
information being developed by the OECD.
Greater tax transparency and exchange of
information is intended to benefit both developed and developing
countries. The G20 has committed to provide technical assistance to
developing countries to ensure they can benefit from greater tax
transparency, given the importance taxation plays in governance and
As part of this, the United Kingdom and
South Africa have committed to a long-term partnership to support the
tax capacity building of revenue authorities in the region.
More information on both of the above is available on the HM Treasury website.
This article first appeared in charteredaccountants.ie.