aim key cog flag clipboard-pencil podium flare signal lamp pie-chart graph scale2 hammer2 balance traffic-lights road archery wall share2 warning notification-circle circle-minus prohibited book book2 bookmark

Call your nearest office

Or ask us a question

Search our site

What are you looking for?

What Was the Lichtenstein Disclosure Facility (LDF)?

Facing a tax investigation? Need to make a disclosure to HMRC? Don’t worry. One of our team will be able to help. Just get in touch.

In September 2009 HMRC introduced the Liechtenstein Disclosure facility (LDF). It arose from an agreement between HM Revenue & Customs (HMRC) and the government of Liechtenstein for those with ‘relevant property’ in Liechtenstein. Although the LDF which was primarily intended as an offshore disclosure facility it was also possible to disclose domestic matters and still retain the favourable terms.

The LDF was available to individuals, trusts or companies and was originally intended to be available from September 2009 to 31 March 2015. The deadline was extended to 5 April 2016 but the facility was closed early on 31 December 2015.

To qualify for the LDF a taxpayer could not be linked to another HMRC disclosure facility, and must not have previously been the subject of a criminal investigation.

As Lichtenstein Jersey is a Category 1 country, so far as penalties are concerned, failure to remedy any tax compliance failure could have resulted in penalties of 100% of the tax (again) as part of any Settlement, plus interest.

The key terms of the LDF

Under the LDF, a taxpayer was required to:

  • make a Disclosure within 7 or 19 months of being registered under the JDF depending upon the basis of calculation
  • disclose irregularities from commencement or back to 6 April 1999, whichever was shorter
  • pay
    • all taxes at the actual rates for the year or a flat rate of 40%
    • interest on all tax paid late
    • No liability for any period prior to 6 April 1999
    • a penalty capped at 10% of the tax due for the 10 year period ending 5 April 2009, thereafter 20%
    • higher penalties of 30% for 2011/2012 onwards as the inaccuracy related to a Category 1 country
  • make a payment within 30 days of the application date
  • disclose all their assets and liabilities as at 5 April prior to the date of disclosure
  • be told whether their disclosure was accepted within 9 months

The scope of the facility was reduced in some cases from August 2014.

What taxes were covered?

Under the LDF, the following taxes were covered:

  • Income tax
  • Capital gains tax
  • Inheritance Tax
  • Value Added Tax
  • Corporation Tax
  • Employment taxes (PAYE, Employees NIC and Employers NIC)

How was Haines Watts able to help?

Haines Watts was able to:

  • Assist in obtaining the necessary ‘Relevant property’
  • Register those who wished to make a disclosure to HMRC under the terms of the LDF
  • Manage the process throughout for them
  • Discuss matters with HMRC initially on a no name basis
  • Agree with HMRC in advance how matters were to be treated
  • Calculate the potential tax liability allowing taxpayers to keep their anonymity until they wished to disclose
  • Determine how matters would be treated and taxed with HMRC prior to registering under the LDF
  • Discuss with the taxpayer how to proceed with the disclosure
  • Seek time for payment of the amount due
  • Complete all relevant documentation
  • Negotiate a full and final Settlement with HMRC as necessary

If you wish to discuss this or any other matter with a member of the team, please contact us.

 

If you cannot find the information you need on our website, please contact Paul Malin or Andy Maxfield using our contact form or email directly to pmalin@hwca.com or amaxfield@hwca.com

Get in touch

Whatever issue or question you have, we’ve got the answer.
If you want to get in
touch then please complete our form.

Birmingham

Haines Watts Birmingham
Sterling House
71 Francis Road
Edgbaston
Birmingham
B16 8SP

Leeds

Haines Watts Leeds
Sterling House
1 Sheepscar Court
Meanwood Road
Leeds
LS7 2BB

London

Haines Watts London
New Derwent House
69 – 73 Theobalds Road
London
WC1X 8TA

Our addresses

Birmingham

Haines Watts Birmingham
Sterling House
71 Francis Road
Edgbaston
Birmingham
B16 8SP

Tel: 0121 456 1613

Leeds

Haines Watts Leeds
Sterling House
1 Sheepscar Court
Meanwood Road
Leeds
LS7 2BB

Tel: 0113 3981100

London

Haines Watts London
New Derwent House
69 – 73 Theobalds Road
London
WC1X 8TA

Tel: 0207 025 4650