Mutual Legal Assistance (Tax Matters) (Automatic Exchange of Information) Order, 2011

Summary

This Order brings section 17 of the Mutual Legal Assistance (Tax Matters) Act, 2003 into force, marking the Virgin Islands' transition from a withholding tax regime to automatic exchange of information for tax purposes. It sets the commencement date for the new regime and provides a transitional rule for the final year under the old withholding tax system.

• Commencement: Section 17 of the Mutual Legal Assistance (Tax Matters) Act, 2003 (which governs automatic exchange of information) comes into effect on 1 January 2012.
• Transitional withholding tax: For the tax year ending 31 December 2011, the competent authority must still apply withholding tax for that year and transfer any withholding tax levied as provided in section 16 of the Act, even though section 16 ceases to have effect from 1 January 2012.

The Order is short and procedural, serving mainly to fix the switchover date between the withholding tax mechanism and automatic exchange of information under the 2003 Act.

Key obligations

• The competent authority must apply withholding tax for the tax year ending 31 December 2011 and transfer any withholding tax levied in accordance with section 16 of the Mutual Legal Assistance (Tax Matters) Act, 2003, notwithstanding that section's cessation from 1 January 2012.

Deadlines

• 1st January, 2012: Section 17 of the Mutual Legal Assistance (Tax Matters) Act, 2003, providing for automatic exchange of information, comes into effect.
• tax year ending 31st December, 2011: Final year for which the competent authority must apply withholding tax and transfer amounts levied under section 16 of the Act.

Related documents

• This document is made under Mutual Legal Assistance (Tax Matters) Act, 2003 (No. 18 of 2003)