Following the automatic tax information exchange agreement between the UK and the Cayman Islands, signed on 5 November 2013, HMRC has written to UK resident individuals it understands hold bank accounts in the Cayman Islands.
These letters are designed to encourage UK taxpayers to disclose any previously undeclared income and capital gains. They come with an apparent promise that those who do not come forward will be the focus of targeted tax enquiries in the future.
Taxpayers with assets concealed on Cayman have until September 2016 to disclose details to HMRC and pay any tax owed to the exchequer. Depending on their circumstances, in addition to interest, penalties will be charged at between 10% and 20%.
For the financial year 2014 onwards HMRC will be provided with financial information on UK taxpayers with accounts in the Cayman Islands. And from 2016, HMRC be provided will have access to companies and trusts registered on the Island
If you have received a letter from HMRC regarding assets held on Cayman please contact us to consider what options are available to you in order to make a disclosure, should one be necessary.