During the next few years and continuing into the future, unprecedented levels of information will be supplied to HMRC about UK resident individuals who hold assets overseas. Financial institutions and their clients may be affected by international exchange of information agreements, such as the Intergovernmental Agreements (IGAs) with the UK’s Crown Dependencies and Overseas Territories or the OECD Common Reporting Standard (CRS).
IGAs have been in force since 1 July 2014 between the UK and its Crown Dependencies and Overseas Territories. From 30 September 2016, account and financial information will be exchanged with HMRC. This will be significantly extended by the introduction of the CRS, with around 60 countries committed to exchanging information from 2017 and around a further 35 countries from 2018.
The overall impact of this is to oblige governments to obtain client information from their financial institutions (typically bank account details) and copy it automatically to the tax authorities (e.g. HMRC) in other jurisdictions each year.
This could have an impact on anyone with overseas assets - for example, UK residents who hold assets overseas and UK resident non-UK domiciled persons, but in particular:
Those impacted by the forthcoming information exchange agreements, whether their UK tax affairs are compliant or otherwise, may now wish to consider proactive action. This should be before the Liechtenstein Disclosure Facility (LDF) ends (which is currently expected to be on 5 April 2016) and with it the key benefits it provides.
For further information please see www.kpmg.com/uk/personal-tax-investigations
This article represents the views of the author only, and does not necessarily represent the views or professional advice of KPMG in the UK.