Guernsey Launches Interest Tax Amnesty
by Jason Gorringe, Lowtax.net, London
04 July, 2014
Having secured new sources of information on the affairs of Guernsey taxpayers, the Government is encouraging delinquent taxpayers to come forward and regularize their tax affairs.
The Guernsey Government has launched a "Stop Tax Evasion Programme" (STEP), which mainly concerns undeclared income and bank interest. Taxpayers availing themselves of the new amnesty before March 31, 2015, can avoid prosecution providing they make a full declaration and pay all the tax due by that date.
The initiative follows a proposal, approved by the States in December 2013, to introduce a new reporting regime for Guernsey banks under which they would provide to the Director details of interest paid to individuals resident in Guernsey. The territory has also recently signed an expansive network of tax information exchange agreements enabling Guernsey authorities to secure information about foreign accounts held by Guernsey residents.
Guernsey will offer two amnesties, the Bank Interest Reporting Disclosure (BIRD) facility, and the Excess Mortgage Interest Relief Disclosure (EMIRD) facility. The second amnesty is intended to challenge tax relief claimed against mortgage interest payments that were not in fact paid. In addition, Guernsey is setting up communication channels to allow for anonymous tip-offs.
Rob Gray, Director of Income Tax, said: "Tax Evasion is a crime, but it is sometimes rationalized as harmless because it is only the "taxman" that is suffering. That is not true. Every tax evader cheats every honest taxpayer in the island - including his own family and friends - because tax revenues are used to fund vital public services such as health, education and public and social welfare."
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