Liechtenstein Disclosure Facility (LDF)
Following an information sharing agreement signed between the UK and the principality of Liechtenstein last month (reported previously on this site) the governments of the UK and Switzerland have now signed a Double Taxation Agreement (DTA) to share information on UK taxes of all kinds.
This will mean that information on individuals can be exchanged by the two countries, though a specific and justified request must be made first for them to do so. The aim of this exchange agreement is to prevent tax evasion involving the use of off-shore accounts.
Stephen Timms, Secretary of State for the Treasury, has said:
"I very much welcome the Swiss Federal Council's agreement on international co-operation in tax matters and their adoption of the OECD standard on administrative assistance.
"The days when hiding money off-shore represented a viable means of evading UK tax are rapidly drawing to a close."
To facilitate the agreement the Swiss Federal Council will change policy and adopt the OECD international tax standard on administrative assistance in respect of all UK taxes. The change to OECD standards is designed to increase the level of information that is shared between those who sign up to agreements such as the DTA, though some detractors say that even OECD standards of exchange are not high enough in some instances.
The UK government hopes that as a result of this agreement there will be an increased awareness of assets held off-shore that should be liable to UK taxation.
The DTA will come into force once the House of Commons has considered the agreement, which is expected to happen shortly. When it is in force a comprehensive exchange of information is expected to take place.
Individuals with money held in Swiss bank accounts are recommended to seek legal advice should they have any concerns over the likely effect the agreement will have on them.
If you or your firm require have any queries concerning issues raised in this article please contact Maurice Martin on 020 7421 3883 or make an online enquiry.