Archive for May, 2018

Cayman launches CbC Reporting Portal

Thursday, May 17th, 2018

The Cayman Islands’ country-by-country (CbC) reporting portal has been launched, with the first CbC reports due from some taxpayers by the end of the month.

CbC reporting requires multinational enterprises (MNEs) that meet certain criteria to file a country-by-country report with tax authorities. CbC reporting applies only to MNE groups with annual consolidated group revenue of not less than a specified threshold amount in the preceding fiscal year, which is USD 850 million in Cayman.

CbC reports are due within 12 months of the end of the fiscal year. As a result of an earlier extension, the first deadline will be May 31, 2018 in order to provide extra time for those taxpayers whose fiscal year began in the first 5 months of the year in 2016.

According to the Finance Ministry of the Cayman Islands, a Reporting Entity resident in the jurisdiction must make a CbC Report via the CbCR Portal even if that results in duplication because a CbC Report for the same MNE Group has already been made to another Competent Authority, for instance where the MNE Group appoints a Surrogate Parent Entity in another participating jurisdiction or where a Reporting Entity resident in the islands is also resident for tax purposes in another participating jurisdiction.

It should be noted that the CbC Report provides a breakdown of the amount of revenue, profits, taxes, and other indicators of economic activities for each tax jurisdiction in which the MNE group does business.

UK to force Cayman to make beneficial ownership of companies public

Wednesday, May 2nd, 2018

The Cayman Islands and other British Overseas Territories lost the political battle in House of Commons vote on May 1.

The vote to amend Britain’s Sanctions and Anti-Money Laundering Bill to force British Overseas Territories – which are not UK Crown Dependencies – to make registers of company owners public, may fundamentally change both Cayman’s financial services business model and its relationship with the UK.

The amendment to the bill, which now goes to the House of Lords for a largely procedural vote, will require all 14 remaining British territories to make beneficial ownership of companies registered in their respective jurisdictions public. The Cayman Islands has such a registry now, but it can only be inspected by certain personnel for the purposes of specific law enforcement or tax compliance requests.

UK and Cayman sources both speculated as to the reasons for why such a decision was made and the conciliatory version of the amendment was not accepted for debate. Many noted that a crucial Brexit bill concerning the operations of the single market once the U.K. leaves the European Union next year was up for debate in the Commons as well.

From Cayman supporters’ perspectives, it was the worst possible outcome.

Cayman London office director Eric Bush told the UK public radio: “We’re exploring all options. The decisions and actions taken [Tuesday] were taken in haste, were taken with misinformation, rhetoric and Hollywood jargon. The Cayman Islands government is not going to do that.”He also added that the actions taken are certainly a blow to the relationship, which shows a lack of trust, it shows a disrespect and disregard for the constitution.