New changes for data exchange and economic substance on the Caymans to be posted

The local regulator on the Cayman Islands - the Department of International Tax Cooperation (DITC) - has unveiled some changes on the exchange of tax information and economic subsidies. The main transformations will concern the rules for filing reports within the framework of the submission of declarations and the rules of company presence.

According to the regulator, the deadline for filing reports for 2018 is May 31, but this period has been extended until July 31 due to new FACTA and CRS reporting rules. Also, the governing body of the Cayman Islands asks clients not to delay reporting and requests to complete it before the deadline in advance.

As for the changes on the issue of economic substance, here new conditions are introduced for investors and company owners. So, DITC insists on the transfer of all registered companies and enterprises on the islands into a single state register. In addition, all companies that claim to remain on the islands are obliged to submit financial statements of activity according to the rules that apply in preferential tax jurisdictions.

Those companies that are registered in the Caymans, but conduct their business activity outside the jurisdiction of the island state, are now required to submit supporting documentation from other countries where the company’s financial activity is taking place. Also, all registered companies will undergo a general registration through the State Register, but only after 2020. For companies that will be registered after August 1, 2020, new rules will be applied, which were announced by the local regulator.

Law and Trust International provides an opportunity to register a company in the Cayman Islands. To learn more about the cost of registration and its features, please contact our lawyers.