(December 19, 2014)

On December 19, 2014 the Canadian Department of Finance issued a press release announcing that the Protocol amending the Convention between the Government of Canada and the Government of the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on Income and on Capital entered into force on December 18, 2014.

The Protocol a.o. makes revisions to or replaces the following Articles from the existing DTA:

• A partial revision of Article 3 (General definitions);

• A partial revision of Article 4 (Fiscal Domicile);

• A replacement of Article 7 (Business Profits);

• A partial revision of Article 8 (Shipping and Air Transport);

• A partial revision of Article 9 (Associated Enterprises);

• A partial revision of Article 10 (Dividends);

• A replacement of Article 11 (Interest);

• A partial revision of Article 12 (Royalties);

• A partial revision of Article 15 (Dependent Personal Services);

• A partial revision of Article 18 (Government Services);

• A partial revision of Article 21 (Elimination of Double Taxation);

• A replacement of Article 23 (Mutual Agreement Procedure);

• A replacement of Article 24 (Exchange of Information);

• An insertion of Article 24A (Assistance in the Collection of Taxes);

• A partial revision of Article 27 (Miscellaneous Rules);

Based on Article XVI of the Protocol, the Protocol will have effect:

a)      in Canada:

(i)      in respect of tax withheld at the source, on amounts paid or credited to non-residents on or after January 1, 2015; and

(ii)    in respect of other Canadian tax, for taxation years beginning on or after January 1, 2015;

b)      in the United Kingdom:

(i)      in respect of tax withheld at the source, on amounts paid or credited to non-residents on or after January 1, 2015;

(ii)    in respect of income tax and capital gains tax, for any year of assessment beginning on or after April 6, 2015; and

(iii)   in respect of corporation tax, for any financial year beginning on or after April 1, 2015.

Notwithstanding the above, the provisions of Article 23 (Mutual agreement procedure), Article 24 (Exchange of information) and Article 24A (Assistance in the collection of taxes) of the Convention, introduced by Articles XII, XIII and XIV of the Protocol, shall have effect from the date of entry into force of this Protocol, without regard to the taxable period to which the matters relate. However, paragraphs 6 and 7 of Article 23 (Mutual agreement procedure) of the Convention introduced by Article XII of this Protocol shall have effect from the date specified through an exchange of diplomatic notes, and Article 24A (Assistance in the collection of taxes) introduced by Article XIV of this Protocol shall not apply to revenue claims in respect of taxation years ending more than five years before the date on which this Protocol enters into force.

Click here to be forwarded to the full text of the Protocol that entered into force on December 18, 2014 as published on the website of the Canadian Department of Finance, which will open in a new window.

Click here to be forwarded to the webpage of the Canadian Department of Finance where you can find the original DTA and earlier protocols.

For further information click here to be forwarded to the press release as issued by the Canadian Department of Finance.

 
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