UK FATCA / CRS Updates

On August 5, 2025, the United Kingdom tax authority HMRC published an update to the International Exchange of Information Manual related to penalties.

Circumstances When a Penalty Will Not Apply: Reasonable Care

In an instance where a penalty would be owed for reporting inaccurate or incomplete information, no penalty will be due if the person took reasonable care. HMRC defines reasonable care as follows: “Where an inaccuracy in a document or an incomplete report has been made despite the person having taken reasonable care to get things right, no penalty will be due.” Additional details on the reasonable care standard can be found on the HMRC site.

Circumstances When a Penalty Will Not Apply: Reasonable Excuse

For all other types of penalties, HMRC will accept a reasonable excuse for failure to comply with the requirements of the regulations, but the failure must be rectified without unreasonable delay once the reasonable excuse has ceased. In the context of UK FATCA / CRS regulations, a lack of funds or relying on another person to do something are not considered reasonable excuses. Additional details on the reasonable excuse can be found on the HMRC site.

Residence Indicia Cures

On August 6, 2025, the United Kingdom tax authority HMRC published an update to the International Exchange of Information Manual related to curing indicia on residence in Reportable Jurisdictions for lower value pre-existing accounts. Details can be found on the HMRC site.

For assistance, please contact me via my contact page or at elizabeth@elizabethmcmorrowlaw.com.