HM TREASURY PUBLISHES ISLE OF MAN “PARADISE PAPERS” VAT REVIEW

On 16th October, HM Treasury (finally) released its review of the so-called “Paradise Papers” claims about VAT evasion/avoidance involving yachts and private jets using the Isle of Man aircraft register.  It says that there is no evidence of aircraft VAT avoidance in the Isle of Man but further compliance checks should be implemented.  It says that the Isle of Man Government has correctly implemented and administered UK and EU VAT law for aircraft and yachts but should implement additional post-registration compliance procedures to ensure that the right VAT continues to be collected.  Following a series of allegations of VAT avoidance in late 2017, the Isle of Man Government invited HM Treasury to carry out a review of its VAT rules and procedures regarding aircraft and yacht importations.  Under the Isle of Man Act 1979, the island must apply VAT rules in a very similar way to the UK, but it is the responsibility of the Isle of Man to assure those rules.  The report finds that the Isle of Man Government carries out extensive and effective compliance checks during VAT registration but (perhaps surprisingly, if existing checks were “extensive and effective”) should implement further compliance checks in the years after registration to ensure that the right amount of VAT continues to be collected.  The accompanying news release also says that HMRC investigations into other aspects of the Paradise Papers continue.

https://www.gov.uk/government/publications/isle-of-man-aircraft-and-yachts-vat-review

https://www.theguardian.com/news/2017/nov/06/lewis-hamilton-avoided-taxes-jet-isle-of-man-scheme-paradise-papers

This blog is primarily for my own use, to keep informed and up to date. However, if you would like to say thank you (and perhaps help me get a new, better laptop when I am away…) you can “buy me a coffee” at https://www.buymeacoffee.com/KoIvM842y

Author: raytodd2017

Chartered Legal Executive and former senior manager with Isle of Man Customs and Excise, where I was (amongst other things) Sanctions Officer (for UN/EU sanctions), Export Licensing Officer and Manager of the Legal-Library & Collectorate Support Section

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