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HMRC internal manual

Compliance Handbook

Offshore matters: failure to notify penalties: categories of overseas territories

The Treasury decides which overseas territories fall into categories 1 and 3. They are specified by a Treasury Order. These orders are made by Statutory Instrument.

See below the lists of category 1 and category 3 overseas territories. Any territories not with categories 1 and 3 are in category 2. The correct list to use depends on the date when the failure to notify occurred.

Territories for failure to notify that occurred before 24 July 2013(PDF 17KB)

Territories for failure to notify that occurred on or after before 24 July 2013 (PDF 16KB)

The Treasury may move a territory between categories. However, the categorisation only applies from the date on which the order comes into force.

For income tax and capital gains tax there is an annual obligation to notify. If a disclosure is made that covers several years, there is a failure to notify for each year. A change of category between those years could result in different penalty maximums and minimums applying for failures for different years.

So you must always check to make sure you identify the correct category that an overseas territory was in at the date on which the person failed to notify HMRC. You can then apply the appropriate maximum and minimum penalty percentages in CH73200 (category 1), CH114600 (category 2) or CH114700 (category 3).

FA08/SCH41/PARA6A

SI2013/1618