On 13 March 2014, HM Revenue & Customs (HMRC) published the International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014, outlining the obligations of reporting financial institutions in relation to the UK agreements with the Isle of Man, Jersey, Guernsey and Gibraltar. These regulations cover the definition of reporting financial institutions, reportable accounts, identification and reporting obligations, as well as penalties that may be applicable and which came into force on 31 March 2014.
HSBC Group Tax is reviewing the Regulations and will provide guidance in due course. It has also reviewed the draft HMRC and Crown Dependencies Tax Authorities' Guidance documents, published in late February, with a view to issuing guidance.
The Crown Dependencies (the Isle of Man, Guernsey and Jersey) and the British Overseas Territories (the Cayman Islands, the British Virgin Islands, Bermuda, Anguilla, the Turks and Caicos Islands, Montserrat and Gibraltar) have all agreed to enter into automatic tax information exchange agreements with the UK.
Four of these UKCDs and OTs (the Isle of Man, Guernsey, Jersey and Gibraltar) have signed reciprocal agreements with the UK, meaning that UK financial institutions will have to provide data on financial accounts held by residents of these territories. The remaining territories (the Cayman Islands, the British Virgin Islands, Bermuda, Anguilla, the Turks and Caicos Islands and Montserrat) are “non-reciprocal”, meaning that UK financial institutions will not have any reporting obligations under the terms of the agreements.