Stuarts Walker Hersant Humphries, a leading Cayman Islands law firm, is pleased to announce the admission of Adam Russell-Knee on his admission to the Grand Court of the Cayman Islands. (L to R) Hon. Margaret Ramsay-Hale (Judge), Adam...
On 1 January 2019, the Cayman Islands introduced The International Tax Co-operation (Economic Substance) Act, 2018 (the “ES Act”).
The ES Act has been issued in response to the Cayman Islands’ commitment to the global initiative to combat base erosion and profit shifting.
The ES Act requires certain Cayman Islands entities (and foreign entities registered in the Cayman Islands) (known as ‘Relevant Entities’) that carry on certain activities (known as ‘Relevant Activities’) to report on such activities to the Cayman Islands Government on an annual basis and to have economic substance in the Cayman Islands. All Cayman entities with legal personality are required to make a notification in compliance with the ES Act to the Cayman Islands General Registry on an annual basis. In addition to the notification obligation, a Relevant Entity that is carrying on a Relevant Activity will be required to make an annual notification to the Tax Information Authority in the Cayman Islands (the “TIA”) via an online portal (the “ES Portal”) and will generally be required to satisfy the applicable economic substance test (the “ES Test”). The TIA will issue user guidance in respect of the ES Portal in the coming months. Where a Relevant Entity carries on more than one Relevant Activity then it will be required to satisfy the ES Test in respect of each activity.
The ES Notification was extended until 30 June 2020. In respect of the entities that are required to make the additional reporting with the TIA, the ES Portal that was expected to be available in Q3 is now expected to be available in Q4.
Please contact your usual attorney at Stuarts should you require any specific information on economic substance in the Cayman Islands.
Please see the PDF for The International Tax Co-operation (Economic Substance) Act, 2018 - November 2019 Update.