International - Mutual Agreement Procedure
Most of the UK’s Double Taxation Agreements contain a provision, the Mutual Agreement Procedure, allowing a taxpayer who considers that he is being taxed otherwise than in accordance with the terms of the Double Taxation Agreement to present his case to his tax administration, the "competent authority." The procedure is also referred to as a request for competent authority assistance. Click here for an example.
The Inland Revenue, as the Competent Authority, will endeavour to provide any assistance as necessary. It might be that the Inland Revenue agrees with the merits of the overseas adjustment and give a corresponding downwards adjustment in the UK, or it may seek to persuade the treaty partner to reduce or withdraw its adjustment. In most cases there is a successful resolution of the double taxation, but there is no guarantee that the procedure will be successful.
There are time limits for a taxpayer to present his case. These are the longer of 6 years from the end of the chargeable period to which the case relates or any longer period specified in the particular Double Taxation Agreement.
Where there has been a transfer pricing adjustment in relation to a UK taxpayer, the affected associated enterprise located in a treaty country should consider presenting its case to the competent authority of that country in accordance with any procedural rules that country may have.
If you have a case to present please send details to:
Revenue Policy International
1 Parliament Street
London
SW1A 2BQ
Please note that cases involving transfer pricing in the petroleum industry should be sent to:
Oil Taxation Office,
Melbourne House,
Aldwych,
London WC2B 4LL
Some of the information about the Mutual Agreement Procedure found in Tax Bulletin 25A has been superseded by measures in Finance Bill 2000. It is expected that further information will be provided during the coming months.
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