The International Tax Enforcement (Disclosable Arrangements) Regulations 2020

Publication Date:January 01, 2020
 
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2020No. 25

TAXES

The International Tax Enforcement (Disclosable Arrangements) Regulations 2020

Made9thJanuary2020

Laid before the House of Commons13thJanuary2020

Coming into force1stJuly2020

The Treasury, in exercise of the powers conferred by section 136 of the Finance Act 2002( 1) and section 84 of the Finance Act 2019( 2), make the following Regulations.

Further to section 84(8) of the Finance Act 2019, the Chancellor of the Exchequer has laid before the House of Commons a report on how the powers in section 84 are to be exercised in each of the scenarios in subsection (9) of that section.

PART 1

Introductory provisions

Citation and commencement

1.—(1) These Regulations may be cited as the International Tax Enforcement (Disclosable Arrangements) Regulations 2020 and come into force on 1st July 2020.

(2) These Regulations have effect in relation to—

(a) a reportable cross-border arrangement which is, or continues to be, made available for implementation or ready for implementation on or after 1st July 2020,

(b) a reportable cross-border arrangement in respect of which, on or after 1st July 2020, an intermediary within the second paragraph of Article 3(21) of the DAC provided, directly or by means of other persons, aid, assistance or advice with respect to designing, marketing, organising, making available for implementation or managing the implementation of the reportable cross-border arrangement, and

(c) a reportable cross-border arrangement the first step in the implementation of which was made on or after 25th June 2018.

Interpretation

2.—(1) In these Regulations—

“arrangement reference number” has the meaning given in regulation 8(4);

“associated enterprise” has the meaning given by Article 3(23) of the DAC;

“competent authority” has the meaning given by Article 3(1) of the DAC;

“cross-border arrangement” has the meaning given by Article 3(18) of the DAC;

“the DAC” means Council Directive 2011/16/EU on administrative cooperation in the field of taxation and repealing Directive 77/799/EEC( 3), as amended from time to time;

“HMRC” means Her Majesty's Revenue and Customs;

“intermediary”, subject to regulation 13, has the meaning given by Article 3(21) of the DAC;

“marketable arrangement” has the meaning given by Article 3(24) of the DAC;

“OECD” means the Organisation for Economic Co-operation and Development;

“relevant taxpayer” has the meaning given by Article 3(22) of the DAC;

“reportable cross-border arrangement” has the meaning given by Article 3(19) of the DAC;

“reportable information” has the meaning given in regulation 6;

“tax” means any tax to which the DAC applies( 4);

“TCEA 2007” means the Tribunals, Courts and Enforcement Act 2007( 5);

“UK intermediary” means an intermediary in relation to whom the United Kingdom is the member State in any of paragraphs (a) to (d) of the list in Article 8ab(3) of the DAC;

“UK relevant taxpayer” means a relevant taxpayer in relation to whom the United Kingdom is the member State in any of paragraphs (a) to (d) of the list in Article 8ab(7) of the DAC.

(2) In applying the DAC for the purposes of these Regulations, “TIN” means—

(i) if the person is resident for tax purposes in the United Kingdom, the unique taxpayer reference number allocated to that person by HMRC,

(ii) if the person is resident for tax purposes outside the United Kingdom, the unique taxpayer reference number allocated to that person by HMRC or, if they do not have one, the reference number allocated to that person by the tax authority in the country or territory in which they are resident for tax purposes, or

(iii) if no such reference number has been allocated, the national insurance number, if any, allocated within the meaning of regulation 9 of the Social Security (Crediting and Treatment of Contributions, and National Insurance Numbers) Regulations 2001( 6).

(3) For the purposes of paragraph (2), “resident for tax purposes” means liable under the law of a jurisdiction to tax there by reason of domicile, residence, place of management or any criterion of a similar nature.

(4) For the purposes of these Regulations, “tax advantage” includes—

(a) relief or increased relief from tax,

(b) repayment or increased repayment of tax,

(c) avoidance or reduction of a charge to tax or an assessment to tax,

(d) avoidance of a possible assessment to tax,

(e) deferral of a payment of tax or advancement of a repayment of tax, and

(f) avoidance of an obligation to deduct or account for tax,

where the obtaining of the tax advantage cannot reasonably be regarded as consistent with the principles on which the relevant provisions that are relevant to the cross-border arrangement are based and the policy objectives of those provisions.

PART 2

Reporting obligations

Reporting obligations: UK intermediaries

3.—(1) Subject to paragraph (2) and regulation 7, where a UK intermediary participates( 7) in a reportable cross-border arrangement, the UK intermediary must make a return within the specified period setting out the reportable information in relation to the reportable cross-border arrangement that is within the UK intermediary's knowledge, possession or control.

(2) Paragraph (1) does not apply to a UK intermediary (“I”) in relation to a reportable cross-border arrangement if—

(a) I is liable to file information in relation to the reportable cross-border arrangement with the competent authorities of another member State which when applying the list in Article 8ab(3) of the DAC features before, or in the same paragraph as, the United Kingdom, or

(b) another intermediary who participates in the reportable cross-border arrangement has made a return setting out the reportable information required to be reported by I in relation to the reportable cross-border arrangement, and

I has evidence that the reportable information required to be reported by I in relation to the reportable cross-border arrangement has been filed or returned.

(3) The specified period is—

(a) in a case where the first step in the implementation of a reportable cross-border arrangement was made between 25 June 2018 and 1 July 2020, the period beginning on 1 July 2020 and ending on 31 August 2020,

(b) in a case where the intermediary is notified of a reporting obligation in accordance with regulation 7, the period of 30 days beginning on the date that notification is received, and

(c) in any other case, a period of 30 days beginning on the earliest of—

(i) the day after the day the reportable cross-border arrangement is made available for implementation,

(ii) the day after the day the reportable cross-border arrangement is ready for implementation,

(iii) the day the first step in the implementation of the reportable cross-border arrangement is made, and

(iv) in relation to a UK intermediary within the second paragraph of Article 3(21) of the DAC, the day after the day the UK intermediary provided, directly or by means of other persons, aid, assistance or advice with respect to designing, marketing, organising, making available for implementation or managing the implementation of the reportable cross-border arrangement.

(4) If the reportable cross-border arrangement is a marketable arrangement, the UK intermediary must make a return at the end of every three month period beginning with the date of the return under paragraph (1), setting out any new reportable information within Article 8ab(14)(a), (d), (g) or (h) of the DAC which has become available in respect of the reportable cross-border arrangement since that return or a previous return under this paragraph.

Reporting obligations: UK relevant taxpayers

4.—(1) Subject to paragraph (3), where paragraph (2) applies, the UK relevant taxpayer must make a return within the specified period setting out the reportable information in relation to the reportable cross-border arrangement.

(2) This paragraph applies where—

(a) a UK relevant taxpayer participates in a reportable cross-border arrangement, and

(b) no intermediary is required to file the reportable information in relation to the reportable cross-border arrangement under regulation 3 or with the competent authority of another member State.

(3) Paragraph (1) does not apply to a UK relevant taxpayer (“RT”) in relation to a reportable cross-border arrangement if—

(a) RT is liable to file information in relation to the reportable cross-border arrangement with the competent authorities of another member State which when applying the list in Article 8ab(7) of the DAC features before the United Kingdom, or

(b) another relevant taxpayer—

(i) agreed the reportable cross-border arrangement with the intermediary, or

(ii) if there has been no such agreement, manages the implementation of the reportable cross-border arrangement, and

RT has evidence that the reportable information in relation to the reportable cross-border arrangement has been filed or returned.

(4) The specified period is—

(a) in a case where the first step in the implementation of a reportable cross-border arrangement was made between 25 June 2018 and 1 July 2020, the period beginning on 1 July 2020 and ending on 31 August 2020,

(b) in a case where the relevant taxpayer is notified of a reporting obligation in accordance with regulation 7, the period of 30 days beginning on the date that notification is received, and

(c) in any other case, a period of 30 days beginning on the earliest of—

(i) the day after the day the reportable cross-border arrangement is made available for implementation to the relevant taxpayer,

(ii) the day after the day the reportable cross-border arrangement is ready for implementation by the relevant taxpayer, and

(iii) the day the first step in the implementation of the reportable cross-border arrangement is made in relation to the relevant taxpayer.

Annual reporting requirement

5.—(1) Where a UK relevant taxpayer participates in a reportable cross-border arrangement, the UK relevant taxpayer must make a return for—

(a) the tax year( 8) or...

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