The UK has reached a new agreement in the tax sphere with the Principality of Liechtenstein

09.02.2012 This week Liechtenstein and the UK reached the agreement on several issues in the tax sphere. One of the most important and interesting topics for discussions became the extension of tax breaks for residents of the UK that hold their funds in the banks of Liechtenstein, the nature of such tax breaks is following: British citizens that keep undeclared funds in the banks of Liechtenstein have the right for 10% rate of penalty from the amount of unpaid tax sum in the case of contribution information disclosure. If there were no tax breaks the sum of penalty could reach 150% of unpaid tax sum paid to the UK budget.

Earlier the termination of such tax breaks was planned in March 2015. Now this term was extended until April 2016. These changes occurred because of the revision of the provisions of intergovernmental agreement (Memorandum of Understanding of 2009) between Liechtenstein and Britain to cooperate on tax issues.

Expert’s opinion

“Specialists emphasize that more than 5,000 British citizens keep money in the banks of Liechtenstein. The sum of their contributions reaches 3 bln. pounds. During the action of these tax breaks the UK may seriously replenish the state budget.

The last time when the amnesty on offshore deposits of British citizens also took place the tax authorities could collect more than expected. Such an arrangement allows investors not to hope at random but declare their income abroad”.

On the basis: www.regierung.li

Andrianova Irina ( the leading lawyer of legal support and banking consulting department of Honest&Bright)