On the 14th of February 2023, the Council of the European Union issued the updated EU list of non-cooperative jurisdictions for tax purposes (the “EU List”), and has included the British Virgin Islands, Costa Rica, Marshall Islands and Russia within the list, which will be effective at the 21st of February 2023. With these latest additions, the EU list now consists of the below 16 jurisdictions:
- American Samoa
- British Virgin Islands
- Costa Rica
- Marshall Islands
- Trinidad and Tobago
- Turks and Caicos Islands
- US Virgin Islands
For all above countries included within the EU List, enhanced due diligence procedures are required. Further concerns that may affect taxpayers include the potential reporting implications under DAC6.
Hallmarks that may be affected with the inclusion of the above-mentioned countries in the EU List, other than those requiring the satisfaction of the main benefit test, are the following:
As per the above hallmark, an arrangement is reportable if it involves deductible cross-border payments between two or more associated enterprises where the recipient is a tax resident in a tax jurisdiction included in the list of third country jurisdictions which have been assessed by the Council of the European Union as being non-cooperative.
As per the above hallmark, an arrangement may be reportable if it involves the use of a jurisdiction already included in the EU List, provided that the use of such jurisdictions could undermine the reporting for the automatic exchange of information agreements.
Our expert team of Tax Advisors are ready to assist with the re-domiciliation of companies from all jurisdictions included in the EU List, and together with our preferred partners, offer legal support and accounting/audit services.
For more information on how we may assist you, please contact us for a free consultation today!
Savva & Associates
Telephone: +357 22 516 671