STEP Wealth Structuring News Digest 05 July 2012

FRANCE – Hollande begins his promised attack on the wealthy

As expected, France’s new Socialist government has announced a series of increases in personal and business taxation. They include an extra Euro2.3 billion of wealth taxes, and a new tax on foreign owners of holiday homes.


USA – Delaware pushes back against calls for regulation

The New York Times has published an article describing just how easy it is to set up a Delaware shell company without disclosing its beneficial ownership – something for which the US administration has regularly pilloried Caribbean islands. Apparently Delaware has more corporate entities than people.

New York Times

JERSEY – Island hits back against “loophole” smears

Jersey Finance’s chief executive Geoff Cook has published a letter in the UK’s Guardian newspaper defending Jersey against accusations of exploiting tax “loopholes”. He says Jersey will not house tax planning schemes that are challenged by HMRC and deemed to be illegal.

Jersey Finance


UK – Controversy over ethics of “aggressive” tax planning

The chief executive of the Institute of Chartered Accountants of England & Wales, Michael Izza, has published a blog article condemning members who assist their clients in “aggressive tax avoidance”. A somewhat similar statement was issued last week by the president of the Chartered Institute of Taxation (see STEP UK Digest 28 June), but judging by reader comments on Izza’s article, the profession is split on the issue.


UK – Stolen HSBC Geneva disk used to convict taxpayer

A British property developer has been convicted of evading GBP430,000 inheritance tax on a Swiss bank account he held jointly with his mother. HM Revenue & Customs obtained Michael Shanly’s account details from the French authorities, who had bought them from a former employee of HSBC Geneva, who had stolen them from the bank.


BBC News

UK – Further comment on statutory residence test

The Chartered Institute of Taxation has published a preliminary opinion on the UK Treasury’s draft legislation for a new statutory residence test.

CIOT (PDF file)

NON-DOMS – Withdrawals from offshore joint account were not remittances

Cash withdrawn by one joint holder from an offshore joint bank account was not a taxable remittance by the other joint holder, who was a remittance-basis non-dom who had funded the account from his foreign earnings. So the UK First-tier Tribunal has held in the case Pflum v HMRC.

PLC (free access)


MONEY LAUNDERING – FATF listens to private sector on new recommendations

The global Financial Action Task Force has published a summary of the April meeting of its private sector consultative forum, of which STEP is a member. The main topic was revision of the FATF Recommendations, including risk-based assessment, customer due diligence, politically exposed persons, wire transfers, beneficial ownership information, and the conflict between money laundering reporting obligations and data protection law.


MONEY LAUNDERING – South African magnate was “too rich” to be a money launderer

The UK Border Agency has been ordered to return GBP700,000 in used banknotes it seized from a wealthy South African while en route from London to Luxembourg three years ago. The England & Wales High Court ruled that Christoffel Wiese is so rich that he was unlikely to be trying to launder the money.

Daily Mail

BAHAMAS – Recent legislation and its advantages for investors

In her presentation at the recent Bahamas Landfall conference in London, Aliya Allen, chief executive of the Bahamas Financial Services Board, discussed the directed trust provisions of the 2011 Trustee Amendment Act; the abolition of the rule against perpetuities; the new Bahamas Executive Entity; and the Bahamas SMART Fund, among other topics.

Bahamas Financial Services Board (PDF 2.3Mbyte)

BAHAMAS – Change of management at Higgs Johnson

Oscar Johnson has been appointed as the new managing partner of Bahamas tax law firm Higgs & Johnson, succeeding Philip Dunkley.

Higgs Johnson (PDF file)

WEB exclusive

USA – New guidance on Offshore Voluntary Disclosure Program
On 26 June 2012 the US Internal Revenue Service released additional guidance on the 2012 Offshore Voluntary Disclosure Program, part of the IRS effort to stop offshore tax evasion and encourage tax compliance. In a STEP Journal web-exclusive, Tom Louthan, Jim Casimir and Steve Onken outline the new details that have emerged


HIGH-NET-WORTH INDIVIDUALS – Asia’s emerging wealthy

A recent report has found that 89 per cent of Asian high-net-worth individuals want more wealth guidance and information from professionals. Louise Polcaro summarises recent research.



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