UK tax authorities are providing GPs an extra six months to comply with a new tax information exchange scheme modeled after the US Foreign Account Tax Compliance Act (FATCA).
GPs have been given until May 31 2016 to supply 2014-2015 tax information on their UK LPs to local tax authorities. Only UK LP tax information recorded on or after 30 June 2014 will be subject to reporting, meaning LPs' 2013 tax information will not need to be reported, according to HMRC.
The UK’s scheme (dubbed by some commentators “son-of-FATCA”) requires foreign GPs to report tax information on financial accounts held by UK citizens or suffer tax penalties. GPs with funds domiciled in British overseas territories and crown dependencies, such as Guernsey and Jersey, two popular offshore fund domiciles, must comply with the law.
Other domiciles covered include the Isle of Man, Anguilla, Bermuda, the British Virgin Islands, the Cayman Islands, Gibraltar, Montserrat and the Turks and Caicos Islands.
The move to give GPs more time mirrors the US' own decision to extend FATCA's go-live deadline to July 1, 2014. However, the deadline for GPs to begin submitting tax information on their US investors remains March 31, 2015. Like the UK, FATCA information reported only needs to cover the 2014 calendar year, and not 2013 as well.
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Jersey Finance chief executive Geoff Cook said the deadline was extended “given the close links between the US and UK ‘versions’ of FATCA.” He added, “it makes sense for the UK agreement to remain in step with the US roll-out and the announcement from HMRC is a welcome and sensible step.”