The Liechtenstein Disclosure Facility (LDF) ran until 31 December 2015. A new information exchange agreement was signed between the UK and other countries including Switzerland in May 2014.  

What's new?

The LDF had been extended to 6 April 2016, however, in the 2015 Budget it was announced that it will end on 31 December 2015.

This guide looks at the LDF and explains the objectives behind the measure, the process for those wishing to take advantage of it, and the benefits attaching to early disclosure within the LDF framework. 

At a glance

Within the framework of the LDF, UK taxpayers have the opportunity to disclose previously undeclared income and gains, derived from investments in Liechtenstein, and thereby benefit from a preferential penalty regime.

Benefits of disclosure within the LDF

  • The maximum penalty is fixed at 10% of the outstanding tax plus interest.
  • No penalty in cases of ‘innocent error’.
  • HMRC will only look back to accounting periods or tax years commencing on or after 1 April 1999 and will not seek to recover unpaid tax from earlier periods.
  • In cases of ‘innocent error’, liability to UK tax will be limited to include only the previous six tax years at the time of disclosure.
  • The taxpayer can choose whether to use a single composite rate of tax at 40% or to calculate liabilities based on an actual basis.
  • HMRC will give assurances it will not pursue criminal prosecution.
  • A single point of contact will be available at HMRC throughout the process.

Time limits

  • The LDF commenced on 1 September 2009 and runs until 31 December 2015.
  • The time limit was extended in February 2012.
  • Financial intermediaries in Liechtenstein will expect the disclosure process to be completed within 18 months of the date they notify the taxpayer, and the time-line laid down by HMRC is as follows:
    • Liechtenstein financial intermediary issues notice to taxpayer.
    • Taxpayer notifies HMRC of intention to disclose immediately.
    • HMRC issues registration certificate within 60 days.
    • Taxpayer sends certificate to financial intermediary within 30 days.
    • Taxpayer makes disclosure within either:
      • 7 months if using the single composite rate of tax.
      • 10 months if calculating liability on an actual basis.
    • HMRC issues disclosure certificate within 30 days.
    • Taxpayer sends certificate to financial intermediary within 30 days.
    • HMRC reviews and agrees disclosure.


The LDF is available to UK taxpayers with ‘relevant property’ or ‘an interest in relevant property’ held in Liechtenstein subject to the following restrictions:

  • If a person is already under investigation by HMRC they cannot participate.
  • If there has been a previous investigation by HMRC and a person did not knowingly disclose their interest, they will be able to participate however will not be able to benefit from the limited penalty provisions.
  • Any person who was contacted by HMRC under the terms of the Offshore Disclosure Facility or the New Disclosure Opportunity will be able to participate but will not benefit from the limited penalty provisions.  Any penalty will however be restricted to penalties under the New Disclosure Facility.
  • Any person who has a bank account or financial portfolio account which was opened through a UK branch or agency will be able to participate but will not, in relation to that account, be eligible for the shorter limitation period, the fixed penalty or the composite rate option.