Guernsey tax dodgers face 200% penalties under UK deal

The Treasury is set to sign off a deal with Guernsey that will force British holders of Guernsey accounts to report unpaid tax by September 2016 or face penalties of up to 200%.

It follows a similar deal made with the Isle of Man under the UK's Fatca proposals with its Crown Dependencies, and will target around £4.2 billion of UK-sourced retail and trust deposits held on the crown dependency.

Non-doms, who hold around £2 billion on the island, will be subject to lighter rules, according to reports in the Financial Times.

Guernsey said tax reporting would be along the lines of US rules the Foreign Account Tax Compliant Act. It said the deal would include a revised double taxation agreement.

The agreement will be presented to the Guernsey parliament for approval.

Guernsey chief minister Peter Harwood said: ‘Guernsey is fully committed to combating tax evasion and the principle of automatic exchange and out twin intergovernmental agreement approach to US/UK reporting will provide our industry with a very strong platform to compete on the world stage against weaker, less transparent and compliant jurisdictions.’