Clampdown on overseas tax havens
As evidence that our Government are serious about clamping down on the use of overseas tax havens to avoid UK tax, readers may be interested in the following information regarding the Cayman Islands.
A new Double Taxation Arrangement (DTA) between the UK and the Cayman Islands was recently signed in London.
The new DTA has been drafted to deal with the avoidance of double taxation and the exchange of information necessary to prevent fraud. The arrangement will apply to taxpayers who are resident in either the UK, Cayman Islands or both jurisdictions. In the UK the agreement will apply to income tax, corporation tax, capital gains tax (in relation to the exchange of information), inheritance tax and VAT.
The exchange of information provisions meets the OECD standards and it is expected this new DTA will help combat tax avoidance and money laundering involving both countries.
The DTA will take effect once both countries have finalised the legislative procedures needed to give the arrangement the force of law in both countries.