Beryl Posted May 19, 2006 Share Posted May 19, 2006 This may be of interest to some of you.http://news.bbc.co.uk/2/hi/business/4761851.stm If you have a Barclays account in the Channel Islands , the UK Inland Revenue (can't remember its new name) may be interested. Link to comment Share on other sites More sharing options...
Honeydo Posted May 19, 2006 Share Posted May 19, 2006 I am sure that this does not just apply to Barclays, but to all banks from the Uk who hold offshore accounts. This was bound to happen under EU regulations. Honeydo Link to comment Share on other sites More sharing options...
Sunday Driver Posted May 19, 2006 Share Posted May 19, 2006 This is all to do with offshore account holders attempting to evade UK tax. HMRC has always had wide ranging powers to tackle tax evasion.Ever since the Money Laundering Regulations were introduced in 1973 to combat international drug trafficking , all EU financial institutions have been obliged to take proper steps to identify their customers and to report suspicious transactions to the authorities. In the UK, this was extended by the Proceeds of Crime Act under which transactions suspected of having been derived from any serious crime are to be reported. So, if your bank sees transactions coming through your account which are inconsistent with what should be expected, then they are obliged to investigate and if appropriate, to report it. The law exempts financial institutions from their confidentiality rules so they cannot be sued in the event of legal disclosure.Anyone with a properly declared and maintained offshore account will have no concerns. Link to comment Share on other sites More sharing options...
hastobe Posted May 19, 2006 Share Posted May 19, 2006 I think the Revenue are being a tad optomistic with the amounts theyhope to collect. They seem to have this idea that most offshoreaccounts in the CI or IOM are held by UK taxpayers who aresyphoning income away from the UK tax authorities. Thereality is that most of our offshore accounts are held by non UKresident individuals - who wouldn't be paying UK tax ontheir interest anyway. Talking to colleagues from otherbanks they are of the same opinion. I think this governmentjust reads 'evasion' when ever it sees the word 'offshore'. However, I would add that the Revenue can already get details ofinterest paid on all accounts in Europe under the EU Savings Directive- whether or not the account holder is resident for tax in thatcountry. The Revenue are also widening their powers for obtaininginformation generally from banks etc - so if you are 'on the fiddle'better be careful - they have ways of finding out...Kathie Link to comment Share on other sites More sharing options...
Catalpa Posted May 19, 2006 Share Posted May 19, 2006 [quote user="hastobe"]I think this government just reads 'evasion' when ever it sees the word 'offshore'. [/quote]Isn't it also that the media often concentrates on and reports the evasion angle? The BBC report comments: " HMRC can barely disguise its glee at the legal victory it won at a hearing before the Special Commissioners in February. " It's not exactly unemotional language.Anyway, there's always Luxembourg or Lichtenstein... Switzerland's now rather passé... [6] Link to comment Share on other sites More sharing options...
hastobe Posted May 19, 2006 Share Posted May 19, 2006 [quote user="catalpa"][quote user="hastobe"]I think this government just reads 'evasion' when ever it sees the word 'offshore'. [/quote]Isn't it also that the media often concentrates on and reports the evasion angle? The BBC report comments: "HMRC can barely disguise its glee at the legal victory it won at ahearing before the Special Commissioners in February. " It's not exactly unemotional language.Anyway, there's always Luxembourg or Lichtenstein... Switzerland's now rather passé... [6][/quote]LOL too true!Kathie Link to comment Share on other sites More sharing options...
Lollie Posted May 21, 2006 Share Posted May 21, 2006 My understanding of the EU directive is that 'offshore banks' must inform your country of residence tax office of any interest paid to you as from July 2005. Is this not correct?Lollie 44 Link to comment Share on other sites More sharing options...
hastobe Posted May 21, 2006 Share Posted May 21, 2006 The EUSD requires banks etc in the EU to provide details ofthe interest paid to all account holders resident in the EU (and other reportablecountries - e.g. BV Islands, Cayman Islands etc) with effect from July 2005. Note that this report is based on the address of the account holder - not the location of their account. Previously banks didn't have to report accounts held bynon-residents where interest was paid gross - the report wasessentially a return of interest where paid where tax had been deductedat source. Most non-residents have an R105 in place and so receivetheir interest gross.As an alternative to making the return, some territories (e.g. Isleof Man) have elected to simply apply a withholding tax to interestpaid. For certain products the withholding tax can be avoided -hence no tax cost to investor and no information back to the EU taxauthorities. Therecent case bought by HMRC against Barclays, requires Barclays (i.e.the UK resident holding company - which is subject to UK tax law) todisclose information in respect of customer accounts held by itssubsidiary offshore deposit taker. If the interest paid wasrequired to be returned under the EUSD, the case wouldn't have beennecessary.Kathie Link to comment Share on other sites More sharing options...
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