GAT News January 2017

Industry News January 2017

Statement from Deputy St Pier

Following the speech from Theresa May, a copy can be found by clicking HERE, Deputy St Pier issued the following statement:

‘I welcome the additional clarity provided today by the UK Prime Minister, Theresa May, on the UK Government’s objectives on its exit from the EU. It is reassuring that the UK objectives echo or work well with the negotiating objectives agreed by the States in its first Brexit policy letter on 29 June 2016.

‘While Guernsey is not part of the UK or the EU we are not immune from the impact of the UK exit, not least because we have a special relationship with the EU under Protocol 3. To date our engagement with the UK Government, as promised by Theresa May, has been a model of best practice. Next week, I will again be meeting Robin Walker MP, Minister from the Department for Exiting the EU, this time alongside Mark Garnier MP, Minister at the Department of International Trade, to continue these discussions and further discuss the Prime Minister’s announcement.’

The negotiating objectives included in the Policy letter from last June are available HERE:

The negotiating objectives are summarised in appendix 3. For example:
• The UK objective for tariff free trade with the EU reflects our objective in replacing Protocol 3 for trade with the EU if possible (as well as ensuring there are no trade barriers with the UK).
• The UK Government will seek a Free Trade Agreement with the EU, we have identified that the opportunity for access to any such agreement for the island is desirable.
• The UK Government will also seek to retain the Common Travel Area. The UK will seek to respect worker rights in the UK and guarantee the rights of EU nationals in the UK. The controls on immigration are intended to work in the national interests, including to permit the inward migration of workers. We have shared objectives in this regard.

Our engagement programme with the UK will continue of the priority areas of financial services, fishing/agriculture, free movement of people and customs union. I will keep you updated as this work progresses.

If you have any queries with regards to the above please email Jo Reeve.

Guernsey Income Tax – Country-by-country reporting

Background:  Guernsey has introduced country-by-country reporting, as one of four minimum standards under the OECD Base Erosion and Profit Shifting (BEPS) project, to improve transparency between multinational businesses and tax authorities.

Under country-by-country reporting, multinational groups with consolidated group revenue of EUR 750 million or more, are required to report specified data on their international operations to their tax authority annually (“full reporting”), in respect of accounting periods commencing on or after 1 January 2016. That tax authority will in turn disseminate relevant information to jurisdictions with which it has an agreement to exchange such information.

Present indications are that due to the current revenue threshold level involved, only a handful of Guernsey entities will be impacted by the introduction of country by country reporting.  A consultation on the introduction of country by country reporting in Guernsey was undertaken in October 2016.

A secondary aspect of the country-by-country reporting regime requires the separate business units of multinational groups (“MNEs”) to provide notification to the tax authority annually as a constituent entity if:

(a) they are included in the consolidated financial statements of an MNE for financial reporting purposes, or would be so included if equity interests in such business unit were traded on a public securities exchange;

(b) they are excluded from the MNE’s consolidated financial statements solely on size or materiality grounds; and

(c) they are a permanent establishment of (a) or (b) for which separate financial statements are prepared.

Full reporting:  Broadly the ultimate parent entity of a qualifying multinational group must file, to their tax authority, the relevant country-by-country report on the group’s behalf. It is, however, possible for the MNE Group to elect for a different constituent entity to do the reporting (making that entity a “surrogate parent entity”).

Full reports will be required in an XML format using the schema provided by the OECD and made using a web based reporting tool called the Information Gateway Online Reporter (IGOR). Further information concerning the use of IGOR will be added to the Income Tax website in due course.

Constituent entity notification:  Constituent entity notification should be provided annually through the company income tax return, which has been updated for this purpose. The corporate service provider composite return is also in the process of being updated to enable notification through this return too.

The following information must also be provided where a company is a constituent entity:

    • Name of the reporting entity for the MNE
    • Country of tax residence of the reporting entity
    • Accounting period end of the reporting entity

If you are unsure whether a company is a constituent entity, or who the reporting entity is, you should seek clarification from the parent entity or professional advice. The first notification will be required in respect of accounting periods commencing on or after 1 January 2016.

For further information on country by country reporting, including the relevant regulations, please see HERE.

GIBA

The most up to date GIBA Summary Minutes can be accessed by downloading the link here:

20161108-summary_minutes_GIBA

Forthcoming Events

Remember to check our Events Calendar for Industry presentations and other events that may be of interest.

Guernsey Finance

Private Wealth Breakfast Briefing: Leading New York fiduciary litigator, Steven Holinstat, will be our guest speaker at an on-island Breakfast Briefing on Wednesday 15 February. Senior counsel for Proskauer, Steven has been the lead litigator in some of the US’s highest-profile fraudulent conveyance and HNW trust cases, including the successful overturn of a probate order on a $70 million estate left to charity. To register for Mitigating the Risks of Fiduciary Litigation: Guidelines for Institutional Trustees click HERE.

Other upcoming GF dates:

  • 08 Feb Guernsey Funds Masterclass, London –  Keynote speaker: Louise Harvey OBE
  • 27 Feb SuperReturn International, Berlin
  • 1st Q 2017 Roadshows to South Africa & the Nordics

Their most recent list of events is available HERE.

To get involved please go to www.weareguernsey.com or call 01481 720071

STEP Guernsey

Lunchtime Lecture No. 6

Will Morgan from Offshore Consulting is presenting on Financial Reporting Update:

– FRS 102 for Trust Officers, understanding the impact of the regulatory changes
– Reviewing financial statements – what are the pitfalls, what should be considered
– Overview/ refresher of key accounting standards
– Simple basic accounting case studies

Mark’s presentations are a regular in the STEP Guernsey calendar and are popular across all levels of administration, book early so you don’t miss out.

Lecture details:
Date: Monday 27th February 2017
Time: 11.45am for 12pm
Venue: The Dorey Room, St James
CDP: meets requirements for members

Please book HERE

Evening Lecture No. 6

STEP are delighted to welcome guest speakers Ben Hillman & Michael Rowlands, Kingsley Napley LLP. Kingsley Napley is an internationally recognised law firm based in Central London who will be delivering a letcure on: What Happens to the Difficult Ones? Trusts of land and family law”

Ben is a Senior Associate and head of the Real Estate Disputes team, within the firm’s Dispute Resolution department. He is an experienced general commercial and fraud litigator, with a broad range of knowledge.

Michael specialises in complex families where wealth is often intergenerational and multijurisdictional. Michael has been involved in leading cases on trusts and offshore wealth and works with families planning marriage and international relocation, particularly between America, the UAE and offshore tax jurisdictions.

Lecture details:
Date: Thursday 16th February 2017
Time: 5.15pm for 5.30pm
Venue: The Dorey Room, St James
CDP: meets requirements for members

Please book HERE

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