Cayman Islands Releases EU Savings Tax Figures

by Phillip Morton, Investors Offshore.com, London

03 December 2008

The Cayman Islands Tax Information Authority has released statistics showing the number of reports made to tax authorities in the European Union last year, disclosed in compliance with the Savings Tax Directive.

The 2007 statistics released this week show that:

The largest number of reports on accounts based in the Cayman Islands were sent to the French tax authority (1,579) followed by the UK with 1,283, although the aggregate amount reported to the UK was substantially higher, at USD22m, compared to just USD1m reported to France.

The third highest aggregate amount was reported to the Netherlands (USD5.9m) from 41 reports.

In total, 3,862 reports were made to EU member states by the TIA on USD35m in savings held in the Cayman Islands.

As the competent authority for the purposes of the reporting of savings income information, the Tax Information Authority (TIA) is responsible for receiving the prescribed information from domestic 'paying agents' and for transmitting that information to the relevant counterpart competent authorities in European Union member states.

The TIA has the authority to publish aggregate information relating to the volume of reports, associated dollar values and number of paying agents. These figures are based entirely on data submitted to the TIA by Cayman Islands paying agents in compliance with their statutory reporting obligations under the ROSII Law and Regulations outlined in the EU Directive.

All data is in respect of relevant payees who have their residence in an EU member state and to whom savings income has been paid in the reporting period. Data that is specific to relevant payees is confidential to the TIA and its counterpart competent authorities under the terms of the agreements between the Cayman Islands and each EU member state. Whether and at what rate the reported savings income is taxable is determined by the tax code of the relevant EU member state.

It is also important to note that the Cayman Islands’ agreements with EU member states are non-reciprocal and all data in the tables below is, therefore, in respect of outgoing reports only. The Cayman Islands currently conforms to the Savings Tax Directive in the form of an information exchange policy and therefore is not obliged to operate a withholding tax.

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