Timms Announces UK Tax Treaty Priorities

by Jason Gorringe, Tax-News.com, London

Monday, July 06, 2009

UK Treasury minister, Stephen Timms, has announced details of the UK’s treaty negotiating priorities for the year to March 31, 2010.

Timms, Financial Secretary to the Treasury, disclosed in a July 1 announcement that the government intends to take forward work on new tax conventions with almost 20 onshore and offshore jurisdictions, including Australia, Austria, Belgium, the British Virgin Islands, the Cayman Islands, Croatia, Ethiopia, Germany, Hungary, Israel, Luxembourg, New Zealand, Oman, Qatar, Spain, Switzerland and Thailand.

The UK’s double taxation convention priorities are reviewed by the government each year to ensure that the treaty network continues to meet the needs of the businesses and individuals receiving income from abroad.

Several new double tax treaties signed by the UK have come into force recently, including agreements with: Saudi Arabia (signed October 31, 2007, in force January 1, 2009); Slovenia (signed November 13, 2007, in force September 11, 2008); and Moldova (signed November 8, 2007, in force October 30, 2008). In addition, new protocols signed with Switzerland and New Zealand on June 26, 2007 and November 7, 2007, respectively, came into force on December 22, 2008 and August 28, 2008, respectively.

In 2008 and 2009, double tax agreements were also signed with the Netherlands, France, Libya, Mexico, and the Cayman Islands.

The UK also plans to progress work on Tax and Information Exchange Agreements (TIEAs) with three offshore territories, including Anguilla, Gibraltar and the Turks & Caicos Islands.

The UK has as an ongoing programme of TIEA negotiations with jurisdictions that have committed to implement the Organization of Economic Cooperation and Development’s international tax standard of transparency and exchange of information for tax purposes.

A TIEA between the UK and Bermuda was signed in London on December 4, 2007, entered into force on November 10, 2008 and took effect from December 4, 2008.

A TIEA and an arrangement amending the 1955 Double Taxation Arrangement between the UK and the Isle of Man, signed in Douglas on September 29, 2008, entered into force on April 2, 2009. The provisions of the TIEA also took effect in the UK and the Isle of Man on April 2, 2009.

A tax information exchange agreement and an agreement for the avoidance of double taxation of individuals, between the governments of the UK and the British Virgin Islands were signed in London on October 29, 2008 and laid before the UK parliament on June 17, 2009 at the same time as TIEAs and treaty amendments with Guernsey and Jersey.