Making a disclosure to HMRC - facility now available for Jersey and Guernsey

March 22, 2013

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Earlier this week the UK issued Memorandums of Understanding (MOU) with Jersey and Guernsey which make available a disclosure facility for each of the Islands; these are similar to the agreement that was recently negotiated with the Isle of Man. The disclosure facility is linked to new information-sharing agreements which, from 2014, will require the details of financial assets or entities held in the Channel Islands (and the Isle of Man) by UK residents to be provided to HM Revenue & Customs (HMRC)

An opportunity to make a disclosure

The disclosure facilities run from 6 April 2013 to 30 September 2016 and provide an opportunity for those with assets in Jersey or Guernsey to make a tax disclosure to HMRC. To use the facilities to disclose unpaid tax liabilities a person must either hold or have a beneficial interest in relevant property held in Jersey or Guernsey between 6 April 1999 and 31 December 2013. Assets can be moved to Jersey or Guernsey to allow qualification. To qualify, the person mustn’t be under investigation (civil or criminal) at 6 April 2013.

Understanding the differences from the Liechtenstein Disclosure Facility

While the terms are similar to the Liechtenstein Disclosure Facility (LDF) the main differences are that:

  • there’s no guaranteed immunity from prosecution (although the prospect is very unlikely for anyone making a full disclosure)
  • there’s no composite rate option, and
  • anyone within the scope of the UK/Swiss agreement is ineligible to qualify.

But one key difference is that there’s only a requirement to have held an offshore asset as at 31 December 2013. Anyone with a purely UK disclosure may want to consider opening an account in Jersey, Guernsey (or the Isle of Man) prior to 31 December 2013 so that they’re eligible for the settlement terms on offer.

Getting the right advice 

Our Tax Dispute Resolution team can help you to consider the options available and advise on the most effective route in reaching resolution of historic tax issues. We’d be happy to meet with anyone who’s affected, or thinks they might be affected, by these changes. If you’d like to know more, please contact us on 0800 328 8215 or email [email protected]