Many Bermuda residents have organised for months for their annual Christmas shopping jaunt onshore, or to celebrate the holidays with relatives outside of Bermuda. Do you consider yourself a global citizen even though you live in Bermuda? Do you have the ability to travel the world using more than one travel document in a passport of convenience fashion? Is one of those passports a US passport? Have you (or your family) purchased a couple of those neat condominiums over the years in those sunny Southern States or in bustling London town? Do you hold investments onshore?

Why should such questions be asked? Talk about putting a damper on the festive spirit!

The answer: As a people, we are in the midst of a rapidly changing global compliance and reporting environment. Nations and their revenue authorities want to know unequivocally who their citizens are, where they are, and whether they are meeting their tax, legal, and financial obligations. These initiatives, in various formats such as bi-lateral tax information exchange agreements, anti-money laundering, tax compliance amnesty and qualified intermediary programmes for foreign financial institutions, have been on scale for a number of years but have become more focused as the global recession has decimated many countries' budgets.

Additionally, as various Government taxing authorities have discovered and as we've seen in media related accounts, they have managed to recover significant amounts of tax sidelined assets from persons not compliant with country tax laws. The United States, and they are not alone, have increased the pressure on foreign financial institutions through a series of new regulations, holding them accountable to identify the status of, and identify United States account holders and investors.

Tax planning is the single most significant driver of the globally mobile citizen. If you do not understand your tax position relative to your country of origin, residence, citizenship, country of investments, your relationship with your family, and ownership of multi-jurisdiction assets, you may have a problem coping with these changes.

Of course, as I have written several times in prior Moneywise articles, if you are real Bermudian, never leave Bermuda, never marry anyone but another Bermudian who never leaves Bermuda either, never allow your extended family to leave, never invest outside of Bermuda, hold all your investments in Bermuda property, securities and accounts, it is likely that none of the above applies to you.

Increasingly, though, there is a decreasing number of island-isolated Bermudians. Almost everyone is exposed to the outside world; for instance, indirectly through currency exchange transactions to effect purchases of ordinary household expenditures, or if employed, directly through a national pension scheme where your retirement pension is invested in US dollars and other major country currencies.

For the rest of us, then it may be a different story. While we may not ultimately be affected personally, it is important to be aware of the ramifications that can come into play every time we cross a border, physically and electronically.

Bermuda residents are combinations of nationalities, citizenships, possible other taxing regimes, multinational families, and multi-jurisdictional connections. We are seafarers in the modern sense, roaming the world, emigrating, returning, leaving again as income and investments opportunities present themselves. For a small population, we are a complex and unique society. We estimate that as high as one in four Bermuda residents, individuals / families are exposed to more than one taxing regime.

This is a difficult concept to grasp given that Bermuda itself does not even have a tax regime. Further, many still are completely unaware of the outside compliance initiatives in play.

In the next two articles, we will provide an overview of current global tax climate, the scope of demographics that may affect you, the wholesale compliance, filing, and reporting initiatives that will cascade down to you as an account holder/investor at local and international financial institutions, a review of the impact on the structure of foreign trusts and foreign companies, multinational shareholders and beneficiaries with non-financial foreign entities, the broad scale impact on countries/companies/families/individuals, and review of some composite cases, as well as expected compliance with these new regulations.

We will have a look at the United States Treasury Department and Internal Revenue Service initiatives through the Foreign Accounts Tax Compliance Act (FATCA), a far reaching and very, very broad initiative intended to combat tax evasion and fraud. We won't be walking you through specific United States Internal Revenue tax code examples, since most of the weekly readership will drop this topic like a hot potato.

What we will address are many of the issues that will arise simply because of who you are, where you are, and how you will need to handle your global finances in this era in history.

THIS is our new environment, ignore it at your peril. For many, Cross Border Financial Counsel will be Critical.

IRS CIRCULAR 230 DISCLOSURE: Any tax advice contained in this communication (including any attachments) is neither intended nor written to be used, and cannot be used, to avoid penalties under the United States Internal Revenue Code or to promote, market or recommend to anyone a transaction or matter addressed herein.

Martha Harris Myron, CPA, CFP(US) TEP(UK) JP- Bermuda is an international Certified Financial Planner™ practitioner. She specialises in independent fee-only cross border investment, tax, estate, and strategic retirement planning services for Bermuda residents with cross-border and multi-national connections, internationally mobile people and US citizens living abroad. For more information, contact martha.myron@gmail.com">martha.myron@gmail.com or 296-3528 at Patterson Partners Ltd.