IoM Cash Declaration Laws To Come Into Force
On 1st June 2008, two pieces of legislation will come into force in the Isle
of Man that will mean that persons entering or leaving the island will be obliged
to declare cash amounts to a value of EUR10,000 or more (approx GBP7,700). Under the European Communities (Cash Controls) (Application) Order 2008 and
Cash Controls (Penalties) Regulations 2008, individuals will have to declare
these amounts of cash to the Manx Customs and Excise Department in writing, on
forms made available on the department's website, or available at its office
in Douglas. Declarations may be submitted by post or electronically, but must be made at
least 24 hours prior to an individual's departure from the Isle of Man. Declarations
may otherwise be made by depositing a copy of the relevant form in drop boxes
located at the Sea Terminal and the Airport. Similar legislation already exists in the UK and Ireland, and anyone carrying
cash of EUR10,000 or more would be obliged to make a declaration to the customs
authorities when travelling to or from the Isle of Man. These declarations are
in addition to any declaration required in the Isle of Man. The new cash declaration rules went into effect across the European Union on
15th June, 2007. According to the European Commission, the new rules aim to
effect an EU-wide common approach to controlling cash movements into and out
of the EU, while complementing the EU's Money Laundering Directive, which has
already introduced monitoring of transactions made through credit and financial
institutions. The new laws take into account the 2002 Commission report on cash movements
into and out of the EU. This report revealed that from September 1999 to February
2000, EU customs authorities observed a considerable amount of cash plus other
assets such as cheques, securities, gems and precious metals moving in and out
of the EU - a total of EUR1.6bn, of which EUR1.35bn was cash. Under the new rules customs authorities are empowered to undertake controls
on people and their luggage, and detain cash that has not been declared. They
are required to initiate proceedings against people who fail to declare cash
of an amount of EUR10,000 or more. The rules also require the declaration of
the equivalent amount in other currencies or easily convertible assets such
as non crossed cheques. As for penalties resulting from such proceedings, under the EU rules, it
is up to participating states to ensure that they are proportionate to the offence,
so as to have a deterrent effect. A comprehensive report in our Intelligence Report series giving background tax and residence information on many of the key offshore jurisdictions is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report4.asp
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