12.02 – Significant non-compliance

Significant non-compliance may be determined by either HMRC or the Competent Authority of the receiving jurisdiction. In any event, the relevant Competent Authorities will notify the other regarding the circumstances.

Where the UK Competent Authority is notified of significant non-compliance, MHRC must apply the domestic law (including applicable penalties) to address the significant non-compliance described in the notice in a timely manner.

A timely manner shall be taken as a rebuttable presumption to be no more than an 18 month period in which the Financial Institution must resolve the non-compliance.

The following are examples of what would be regarded as significant non-compliance include:

  • Repeated failure to file a return or repeated late filing.
  • Ongoing or repeated failure to supply accurate information or establish appropriate governance or due diligence processes.
  • The intentional provision of substantially incorrect information.
  • The deliberate or negligent omission of required information