Economic Substance Updates - Q3 2020

 

The Department of International Tax Cooperation in the Cayman Islands (the “DITC”) online portal is expected to be launched in Q4 2020. The OECD has developed XML Schema for Nominal / No Tax Jurisdictions to exchange information with partner jurisdictions.

The DITC portal is being designed to conform to the OECD standard and to provide the DITC with the necessary tools for data collection, analysis and effective implementation of the Economic Substance requirements. A user guide and content templates will be published in advance of the DITC portal launch.

Content of Economic Substance reports will be bespoke to each relevant entity conducting a relevant activity.

Template with information to be submitted by entities claiming to be Tax Resident outside the Cayman Islands and some examples of the requisite evidence are as follows:

  • tax Identification Number
  • tax residence certificate and assessment or payment of a corporate income tax liability on all of that entity's income in the Islands from a relevant activity
  • in the case of a disregarded entity for U.S. income tax purposes, a sworn statement from an external tax advisor or 'C' level officer stating that all of that entity's income has been included on the corporate tax return of the U.S. parent company

Further Information

Please contact your usual attorney at Stuarts should you require any specific information on economic substance in the Cayman Islands.


This publication is for general guidance and is not intended to be a substitute for specific legal advice. Specialist advice should be sought about specific circumstances. If you would like further information, please contact:


Jon McLean
Partner
Tel:(+1 345) 814 7930
jon.mclean@stuartslaw.com


Megan Wright
Associate
Tel:(+1 345) 814 7904
megan.wright@stuartslaw.com