The taxman sees all
Poland is persisting in its course of tightening the network of bilateral treaties concerning mutual exchange of tax information. Eight such treaties are already in force - with Andorra, Gibraltar, the Isle of Man, Jersey, Guernsey, the Caymans, San Marino, and – as of 15 March 2015 – also with Bermuda. Seven further bilateral agreements concerning exchange of tax information – with Belize, the British Virgin Islands, Grenada, the Bahamas, Dominica, Liberia, and the United States (FATCA) – have been signed and are presently awaiting ratification.
The treaty concerning exchange of tax information with Bermuda which came into force on 15 March 2015 generally hews to the OECD model agreement from 2002. The two signatory states may provide one another with information concerning tax assessment and collection, enforcement of tax arrears, tax investigations, and prosecution of tax-related criminal offences, among other matters.
The Polish treaty with Bermuda covers information exchange on request only, as opposed to automatic or spontaneous disclosure. With respect to Poland, it covers both types of income tax, i.e. corporate and personal, and with respect to Bermuda – direct taxes, whatever their type or formal designation.
The scope of information subject to exchange pursuant to the treaty is quite extensive, covering information from banks, from other financial inst itutions, and from any and all other parties acting as plenipotentiaries or trustees vis a vis the legal owners and actual owners of capital companies, partnerships, trust funds, foundations, and other persons, including information about all the members of an ownership chain.
The scope of exchange covers information which may be of material significance in administration and application of the internal laws of both jurisdictions, including information of material significance for defining, assessing, and collecting the taxes covered by the treaty, for enforcing collection of tax arrears, for tax investigations, and for prosecution of tax offenders.
Significantly enough, the treaty also provides for assignment of tax officials from one country to be in attendance in the course of tax audits conducted by the other country on its territory.