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Brit expats at risk as Son of FATCA hits British Overseas Territories
| Published: | 22 May at 6 PM |
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The news that the British Overseas Territories have now agreed to greater transparency may well scare those who use the havens for tax evasion, but it’s also a danger for those with legitimate accounts.
Following the Cayman Islands, which agreed to disclosure last month, are Bermuda, Anguilla, the British Virgin Islands, the Turks and Caicos Islands and Montserrat. The required information will include account balances, account numbers, account-holders’ names, addresses, dates of birth, account balances and details of payments received.
According to Chancellor George Osborne, the move is a significant step in reducing tax evasion and is set to be a global standard in the fight. Expats with bank accounts in all the affected jurisdictions are advised to contact their tax advisors as regards their compliance with international law.
However, given recent inefficiencies in the UK’s Revenue services, gleefully laid bare in Britain’s media pages, both residents in the UK and expats with offshore bank accounts are concerned that they may be inadvertently caught in the net. Attempting to unravel public service errors from, say, the Far East or other far-flung expat destinations may be challenging at the very least.
Gary Ashford, spokesman for the Chartered Institute of Taxation and their representative on the HMRC’s Compliance Reform Forum, said that HMRC should recognise that having an offshore bank account is not indicative in itself of tax evasion. He adds that those with cross-border financial arrangements should ensure they have no tax liability, especially if they have offshore trusts.
Following the Cayman Islands, which agreed to disclosure last month, are Bermuda, Anguilla, the British Virgin Islands, the Turks and Caicos Islands and Montserrat. The required information will include account balances, account numbers, account-holders’ names, addresses, dates of birth, account balances and details of payments received.
According to Chancellor George Osborne, the move is a significant step in reducing tax evasion and is set to be a global standard in the fight. Expats with bank accounts in all the affected jurisdictions are advised to contact their tax advisors as regards their compliance with international law.
However, given recent inefficiencies in the UK’s Revenue services, gleefully laid bare in Britain’s media pages, both residents in the UK and expats with offshore bank accounts are concerned that they may be inadvertently caught in the net. Attempting to unravel public service errors from, say, the Far East or other far-flung expat destinations may be challenging at the very least.
Gary Ashford, spokesman for the Chartered Institute of Taxation and their representative on the HMRC’s Compliance Reform Forum, said that HMRC should recognise that having an offshore bank account is not indicative in itself of tax evasion. He adds that those with cross-border financial arrangements should ensure they have no tax liability, especially if they have offshore trusts.
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