Offshore trust compliance
Offshore trust compliance

The following Private Client practice note provides comprehensive and up to date legal information covering:

  • Offshore trust compliance
  • IHT accounts
  • Section 218 return
  • Exemptions
  • Penalties
  • Disclosure of tax avoidance schemes (DOTAS)
  • Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017
  • Requirement to correct past offshore tax non-compliance
  • Requirement to notify HMRC of offshore structures

This Practice Note is based on material originally produced by Tolley in partnership with Milestone International Tax Partners LLP but is now maintained by Lexis®PSL Private Client.

This Practice Note deals with the reporting requirements under section 218 of the Inheritance Tax Act 1984 (IHTA 1984) in relation to offshore trusts, as well as the duty to report imposed by the disclosure of tax avoidance schemes (DOTAS) regime. It also considers HMRC's very wide information gathering powers under the Income Tax Act 2007 (ITA 2007) and the Taxation of Chargeable Gains Act (TCGA 1992).

This Practice Note does not deal with reporting requirements imposed by the US Foreign Account Tax Compliance Act (FATCA), the Common Reporting Standard (CRS), Retained Directive 2018/822, also known as DAC6, the UK-Switzerland Tax Co-operation Agreement and the Worldwide Disclosure Facility. For information on these topics, see the Offshore tax evasion (and private client) sub-topic. See also the following Practice Notes:

  1. FATCA and UK Trusts

  2. Automatic exchange of information—the Common Reporting Standard: a summary

  3. Disclosable cross-border tax arrangements—DAC 6

  4. UK-Switzerland Tax Co-operation Agreement [Archived], and

  5. Worldwide Disclosure Facility

For example, ITA 2007, s 748 gives HMRC the 'power to obtain information' in cases where an officer of HMRC believes there may have been a transfer of assets abroad that falls within the anti-avoidance provisions in ITA 2007, ss 720–735. For details of

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