UK treaty tiebreaker guidelines raise concerns
HM Revenue & Customs on 14 January published new guidelines (INTM120085) on nonstandard treaty tiebreakers that could have an impact on the UK’s tax treaties with the United States, Canada, and the Netherlands. The update to the HMRC International Manual covers cases in which there is no residence tiebreaker clause and the matter must be settled by means of the competent authority procedure (such as under the US, Canada, and Netherlands treaties).
Article 4(3) of the 2010 OECD model tax convention reads as follows:
Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Contracting States, then it shall be deemed to be a resident only of the State in which its place of effective management is situated.
Article 4(4) of the 2008 Netherlands-U.K. tax treaty (the treaty was clarified by a 2010 competent authority agreement ) reads as follows:
Where by reason of the provisions of paragraph 1 of this Article a person other than an individual is a resident of both Contracting States, then the competent authorities of the Contracting States shall determine by mutual agreement the Contracting State of which that person shall be deemed to be a resident for the purposes of this Convention. In the absence of a mutual agreement by the competent authorities of the Contracting States, the person shall not be considered a resident of either Contracting State for the purposes of claiming any benefits provided by the Convention, except those provided by Article 21, Article 24 and Article 25…
If you are registered and logged in to the site, click on the link below to read the rest of the DLA Piper briefing. If not, please register or sign in with your details below.
News from DLA Piper
News from The Lawyer
Briefings from DLA Piper
Don’t forget the 23 September 2014 deadline to ensure your business associate agreements comply with the Omnibus Final Rule
Covered entities with business associate agreements that were entered on or before 25 January 2013 must revise their BAAs by 23 September 2014.
The new amendments to the Russian Civil Code will only apply to legal relationships that emerge after 1 July 2014.
Analysis from The Lawyer
Shearman & Sterling is making its presence felt in the City, squaring up to magic circle firms and looking to muscle in on key relationships. Private equity house Bridgepoint is one outfit that has had its head turned by the US firm.
A new breed of lawyer is smoothing the path for companies entering emerging or unstable jurisdictions