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Bvi Double Taxation Agreements

Since the OECD resumed its offshore tax transparency by publishing its grey and white blacklist, the BVI has concluded numerous tax and information exchange agreements to avoid being called a non-cooperative tax haven (see below). In addition, an amendment to the tax treaty with the United Kingdom was signed in 2008 and double taxation agreements were signed with seven Nordic countries in 2009. Competence was placed on the OECD`s “white list” in July 2009. A limited double taxation agreement between the United Kingdom and the British Virgin Islands came into force on 12 April 2010 and will come into force in the United Kingdom from 6 April 2011 and in the British Virgin Islands from 1 January 2011. In June 2009, Ralph O`Neal, CEO of BVI, announced the conclusion of an agreement on the exchange of tax information with France. With the signing of the agreement, the number of agreements in the British Virgin Island amounts to eleven, which is not only considered “totally compliant” with the OECD`s principles of transparency and information exchange. He added: “In addition to TIEA, we have also successfully negotiated a Memorandum of Understanding on non-discriminatory tax treatment and a double taxation agreement covering the income tax of retirees, students and civil servants.” The agreements were signed by Dancia Penn, BVI`s Minister of Health and Social Development, and senior officials from the Nordic group. Oecd standard agreements provide for the exchange of tax information, both in civil tax matters and where there is concrete evidence of the commission of a tax crime. At the ceremony, Penn also entered into agreements to avoid double taxation with the Nordic group on behalf of the British Virgin Islands. In May 2009, the government of the British Virgin Islands announced the signing of bilateral tax information exchange agreements with the six Nordic countries, including the Faroe Islands, Finland, Greenland, Iceland, Norway and Sweden, on 18 May at the Icelandic Embassy in Copenhagen, Denmark. Two of the UK double taxation agreements with Japan and Switzerland are extended to the British Virgin Islands, although these contracts are not used in practice. In December 2009, the BVI signed texts with Ireland and China. The agreements were signed by the Prime Minister and Finance Minister Ralph O`Neal, the Irish Ambassador to the United Kingdom, Bobby McDonagh, and the Chinese Deputy Commissioner of state tax administration, Qian Guanlin.

Both agreements maintained the territory`s balance sheet at 17. If you use HMRC`s intranet, both agreements can be displayed in the LINK TIEAs sidebar in the sidebar below via the “New Contracts/Protocols in Force” link. On the HMRC website, the search for TIEA British Virgin Islands will provide a link to the agreement. Tax treaties between the BVI and the United Kingdom will come into force as soon as both governments have completed the necessary legislative procedures to implement them. As of July 9, 2012, the ITA has been designated to carry out the duties of the Authority under Section 4.1) of the LawFul Assistance Act (Tax Matters) 2003. In carrying out these functions, the ITA is responsible for dealing with all practical aspects of TIEA applications. The ITA is also responsible for negotiating TIEA agreements with potential contractors to ensure that the Virgin Islands fully comply with the standards of transparency and exchange of information for tax purposes. The ITA is also responsible for developing the effective information exchange framework within the Virgin Islands. Prior to the introduction of the BVI BC Act, the interest of these double taxation agreements applied only to BVI`s resident corporations, in the form of a Cap. 285 companies (see forms of society).

Since the vast majority of BVI companies were either international economic corporations with international limited partnerships or trusts, all of which were tax-exempt and did not fall under double taxation contracts, offshore investors were unable to use BVI double taxation agreements.

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