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The Liechtenstein disclosure facility (LDF) has been extended for a year, after being consolidated by the signing of taxation agreement (DTA).
The new operational deadline of the initiative – the longest-running tax ‘amnesty’ held by HMRC – is 5 April 2016, having originally been set at 31 March 2015. There have so far been more than 2,000 disclosures by UK taxpayers with previously undeclared assets in Liechtenstein, which has finally established a DTA with the British government.
Until now, the alpine principality has been the only European Economic Area member without such an accord with the UK. Under the terms, Liechtenstein will implement new laws to ensure exchange-of-information deals for the first time.
The longer running time of the LDF, which last month saw memorandum changes intended to create greater transparency, is a ‘sensible move’ according to John Cassidy, tax investigation and dispute resolution partner at PKF.
He said the extension would give those affected ‘a better option than the Swiss agreement’, which was announced last August. Existing funds held by UK taxpayers in Switzerland’s banks will be subjected to a one-off deduction of between 19% and 34% to settle past tax liabilities.
