The Tax Times: Get Ready for The Cayman Islands Beneficial Ownership Register & Reporting Under CRS

Tuesday, April 25, 2017

Get Ready for The Cayman Islands Beneficial Ownership Register & Reporting Under CRS

We had previously posted on August 10, 2016, Cayman Islands FATCA Reporting of American Depositors is TODAY - Don't Wait Until it is TOO Late to Come Clean! where we discussed that August 10, 2016 was the deadline for Cayman Islands financial institutions to complete their notification and reporting of American Clients' accounts to the Cayman Tax Information Authority, under the US Foreign Account Tax Compliance Act (FATCA).

Users of Cayman Islands vehicles which fall within the scope of FATCA, as Reporting Financial Institutions (FFIs), which will include most Cayman funds, are reminded that they had until the previously extended deadline of August 10, 2016, to complete their notification and reporting to the Cayman Tax Information Authority.

Now the Cayman Islands Government has adopted new Amended Regulations to ensure the effective implementation of the Common Reporting Standard (CRS) in the Cayman Islands, which requires reporting to the UK, which can then be shared with the US, by June 30, 2017.

Notification Requirement

The Amended Regulations now provide that all Cayman Financial Institutions (CFIs), including Non-Reporting Financial Institutions, must file an information notice with the Cayman Islands Tax Information Authority (TIA), the deadline for which has been extended to June 30, 2017 or, if an entity becomes a CFI after that date, then on or before 30 April of the following year.

The information notice must provide certain required information, including the name and CRS classification of the entity, together with comprehensive details of the person authorized to be that entity's principal point of contact for CRS purposes. Any changes to the required information must be notified to the TIA and all notifications must be completed electronically.

Criminal Liability for CRS Failures

The Amended Regulations now include various offences and corresponding defenses. The offences include making false self-certifications, intentionally providing inaccurate information, tampering with (altering, destroying, mutilating, defacing, hiding or removing) information, or hindering the TIA from performing its functions concerning CRS.

Where a CFI has committed an offence, the Amended Regulations also provide for the imputed criminal liability of the directors, managers, secretaries, trustees, general partner and other similar officers of that CFI.

Do You Have Undeclared Income From

a Grand Cayman Island Account, Entity or