The United Kingdom and the Isle of Man have signed an automatic tax information exchange agreement based on the US Foreign Account Tax Compliance Act (FATCA) to help combat tax evasion.
The intergovernmental agreement was signed in London by Chief Minister Allan Bell MHK and HM Treasury Exchequer Secretary David Gauke MP.
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Under the agreement, the island and the UK will automatically exchange a wide range of information on residents’ tax issues, on a reciprocal basis.
With the new accord, Britain will automatically receive information about bank accounts rather than have to make a request to the authorities in the tax haven.
The agreement between the UK and the Isle of Man is based on this IGA.
On the current timetable for implementation of the new agreement the two Governments have agreed to start exchanging additional information from 2016.
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By GlobalDataAs a result of the agreement between the UK and the Isle of Man, a wide range of financial information on UK taxpayers with accounts in the Isle of Man will now be reported to HMRC automatically each year.
George Osborne, UK Chancellor, said: "The agreement we have now signed with the Isle of Man is a momentous step forward in tax transparency, showing that when we work together we can push the international agenda forward.
"The Isle of Man should be recognised as the first jurisdiction to sign an agreement of this kind with the UK," he added.
Bell MHK said: "We are underlining the message to our neighbours and the wider world that our island is a responsible centre for top quality international business.
"The Isle of Man was the first to strike this agreement with the UK and we are now the first to sign, demonstrating the clear commitment of both countries to the development of a new global standard in automatic exchange," he added.
The UK is looking to agree similar deals with both Guernsey and Jersey.
