Mutual Legal Assistance (Tax Matters) Act (Revised 2020)

Summary

This Act is the Virgin Islands' core statutory framework for international tax information exchange. It implements the US-UK/BVI tax information exchange agreement, the EU Savings Directive, the OECD Common Reporting Standard (CRS), and the OECD/BEPS Action 13 Country-by-Country (CbC) reporting regime, giving the ITA (acting as or through the Authority/Competent Authority) powers to request, exchange, and safeguard tax information.

• Part I - General exchange of information: Empowers the Authority (the Financial Secretary or a designated person) to issue notices requiring persons or entities to provide information relevant to a request under an Agreement, to apply for search warrants for non-compliance, and to conduct consented interviews/examinations of records.
• Record-keeping duty (s.5A): Every BVI company must keep records and underlying documentation (at the registered agent's office or elsewhere), retain them for at least five years, and notify the registered agent of the physical location of records and of any change in that location.
• Part II - EU Savings Income Directive: Sets out beneficial owner identification, residence determination, withholding tax, exchange of information and confidentiality rules for savings income paid to EU-resident beneficial owners.
• Part III - Common Reporting Standard (CRS): Requires Virgin Islands Financial Institutions to establish CRS policies and procedures, register with the Competent Authority, file annual CRS returns in the prescribed form, apply due diligence/compliance measures, and observe anti-avoidance rules; certain accounts are excluded under Schedule 6 (e.g. dormant accounts under specified thresholds).
• Part IV - Country-by-Country (CbC) reporting: Imposes registration and CbC report filing obligations on qualifying multinational enterprise groups' constituent entities, sets time limits for filing, and restricts use and requires confidentiality of CbC report information.
• Offences and penalties: Non-compliance with Authority notices, Ministerial Orders, or Part IV obligations is an offence carrying fines up to US$5,000/2 years imprisonment on summary conviction, or up to US$100,000/5 years on indictment.

The Act therefore underpins BVI's ongoing CRS and CbC compliance obligations for financial institutions and multinational groups, alongside its longstanding tax information exchange and EU savings income provisions.

Key obligations

• Companies must keep records and underlying documentation at the registered agent's office or another notified location and retain them for at least five years from completion of the relevant transaction or termination of the business relationship (s.5A).
• Companies must notify their registered agent in writing of the physical address of any location, other than the registered agent's office, where records are kept, and of any change of that location within fourteen days of the change (s.5A(2)-(3)).
• Persons issued a notice under section 5 must provide the specified information within the time, form and verification manner required by the Authority.
• Virgin Islands Financial Institutions must establish CRS policies and procedures, register with the Competent Authority, file CRS returns in the prescribed form, and apply compliance/due diligence measures (Part III).
• Constituent entities of qualifying multinational groups must register and file Country-by-Country reports with the Competent Authority within the time limits set under Part IV.
• Persons or entities must comply with information notices issued by the Authority unless the information is subject to legal privilege, on pain of criminal penalties for non-compliance.

Applies to

Virgin Islands Financial Institutions, Reporting Financial Institutions, BVI business companies (including foreign companies), multinational enterprise groups / constituent entities subject to Country-by-Country reporting, persons or entities holding information relevant to a tax information exchange request

Deadlines

• fourteen days of the change of location: A company must notify its registered agent of the new physical address of its records and underlying documentation within fourteen days of any change of location (s.5A(3)).
• within one month from the date of the warrant: A search warrant issued under section 6 authorises entry and search of premises within one month from the date of the warrant.

Related documents

• Mutual Legal Assistance (Tax Matters) (Amendment) Act, 2022 amends this document
• Mutual Legal Assistance (Tax Matters) (Amendment) Act, 2022 (No. 4 of 2022) amends this document
• Mutual Legal Assistance (Tax Matters) (Amendment) Act, 2026 amends this document