Spare a thought for the residents of the tiny Channel island of Sark. Everyone it seems is trying to deprive them of a living. For years the residents have fostered the lucrative "Sark Lark", putting themselves forward as directors of non-resident companies - for a hefty fee - to conceal the identity of the beneficial owners. Irish-registered non-resident companies (IRNRs) have become quite a money spinner for the island's directors' club. They regularly appear as directors of many of the 40,000 IRNRs, typically earning fees of more than £100,000 tax free for each one.

The Government is now striving, through the introduction of new legislation, to reduce the potential for this particular line of work amid concerns that some IRNRs are being used by dubious investors as a tax haven to hide the proceeds of crime.

In the meantime, Sark residents are also feeling the heat of the British Home Office. A leaked draft of its report into financial regulation in the Channel Islands reveals it too is determined to stamp out the "Sark Lark". The island has proved remarkably resilient to any such moves in the past given its unique feudal system and its own company law structure. The island is not part of the United Kingdom and is free from many of the tax restrictions and exchange controls that apply to other Channel islands. The Home Office report is due to be issued later this month and will be eagerly awaited by the directors.