Treasury insists on disclosure from islands

At a meeting at the Treasury yesterday, officials from Guernsey, Jersey and the Isle of Man were warned that the UK will not relax its demands for information laid out in formal documents sent to the islands in recent weeks. The document sets out plans to help the islands implement rules required by America’s Foreign Account Tax Compliance Act (Facta). But it also includes a raft of demands for disclosure from the UK Government on clients using the off-shore banks and trusts. Richard Murphy from Tax Research UK said: “At the moment, information exchange agreements impact around 4pc to 5pc of total funds in Jersey. If this goes through, well over 90pc of funds will be subject to information exchange. The demands are radical – they will look through companies to see who owns them; take investment trusts and see who are the beneficial owners; it won’t just be about interest payments but detailed financial information.” Phillip Dearden, director of tax at PKF Isle of Man, said: “It is possible that in the past the Crown Dependencies may have been used for tax evasion but with the many anti-money laundering rules that are now in place, it’s too dangerous to play that game. The big change will be that these rules will impose a far higher administrative cost on local businesses.” Last night the delegations returned to their islands to brief their Ministers. A Treasury spokesman said: “We are assisting the Crown dependencies and the overseas territories with their responses to Fatca.”