Channel Islands May Face Increased UK Scrutiny

by Amanda Banks, Tax-News.com, London

28 October 2002

Business and financial advisers, Grant Thornton have warned that UK residents with bank accounts or investments held in Jersey or Guernsey may come under increased scrutiny following Gordon Brown's pre-budget report.

Speaking as the Chancellor addressed a press conference on Thursday to mark the publication of 'Combating the Financing of Terrorism', senior tax partner at Grant Thornton, Mike Warburton suggested that the pre-budget statement is likely to foreshadow an extension of the powers of the Inland Revenue to investigate the affairs of those with interests offshore.

'The Revenue is already exercising its existing powers to the maximum. For example, the Revenue recently required the Bank of Ireland to disclose details of account holders. It is only a matter of time before an attempt is made to extend these powers,' Mr Warbuton predicted, explaining that the Channel Islands have already granted full disclosure rights to the United States, and that the UK authorities are likely to demand this as well.

He went on to advise UK residents who may be affected by any additional strengthening of the Inland Revenue's powers to make sure that their financial affairs are in order, and that any offshore interests are adequately documented on their tax return forms.

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