Jersey accepts automatic reporting to UK

21 March 2013

Jersey has agreed to the automatic reporting of bank account information to the UK tax authorities.

As with Guernsey and the Isle of Man, there will be a partial tax amnesty allowing UK residents to disclose previously undeclared Jersey accounts to HM Revenue and Customs with limited penalties, though immunity from prosecution is not guaranteed.

UK-resident non-domiciles with assets in Jersey will be exempt from the automatic reporting regime.

Of the three jurisdictions, Jersey has held out the longest against the UK's demands, having conducted a brief consultation on behalf of the island's government before capitulating. Jersey Finance's Deputy Chief Executive Heather Bestwick said the consultation had raised ‘a number of points that will be important to capture in the detail of the final agreement’. The three Crown Dependencies' intergovernmental agreements with the UK are expected to be identical except for detailed jurisdiction-specific annexes.

Jersey's Chief Minister Ian Gorst said the agreement ‘puts beyond doubt our long-held commitment to ensuring that the island is not used for tax evasion by UK-resident taxpayers’.

Tax advisors KPMG called the concession a ‘significant and important development in Jersey's international reputation and status’, but noted it would ‘present challenges to Jersey financial service businesses’.

Jersey is particularly anxious that the UK's insistence on automatic reporting should be applied to other international financial centres, to ensure a level playing field. The UK government is equally keen on the idea: it has just published an offshore evasion strategy document setting out plans to negotiate bilateral automatic information exchange agreements with the British Overseas Territories and other high-priority jurisdictions.

The Cayman Islands has already signalled that it will accept automatic reporting to the UK, in a statement by Financial Services Minister Rolston Anglin to the jurisdiction's legislative assembly on 15 March. The Cayman government has also agreed to implement FATCA's reporting requirements for US-owned bank accounts.

 

Sources

Jersey government

Jersey Finance

HMRC (Memorandum of Understanding with Jersey, PDF file)

HMRC (No Safe Havens report, 2Mbyte PDF file)

Cay Compass

 


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