United Kingdom

Yes - there is clarity that an employee of an employer cannot be an intermediary, where the employer is an intermediary or relevant taxpayer in relation to the cross border arrangement.

Subject to the above point on employees, intermediary is defined as per the Directive (DAC) Article 3(21)

There is no exception from a group company being able to meet the definition of intermediary. HMRC specifically envisage this possibility. See IEIM62170 (https://www.gov.uk/hmrc-internal-manuals/international-exchange-of-information/ieim621070).

These actions are not defined.

There are no deviations from the directive.

There are no deviations from the directive.

There are no deviations from the directive, other than the only requirement is for reporting a cross border arrangement where hallmark D is relevant. The UK plans to consult in 2021 on further rules to align its own legislation more closely with the OECD mandatory disclosure rules. As the UK rules may change - it will be necessary to take advice on the latest status of the UK rules.

There are no deviations from the directive

There are no deviations form the directive.

There are no deviations from the directive

There are no deviations from the directive.

There are no deviations from the directive.

Receipt of an ARN from another intermediary or relevant taxpayer will be sufficient for the recipient to be satisfied that a report has been filed by that other intermediary. The recipient can rely on this without doing any additional work to check the ARN is genuine, unless they have any reason to suspect that the report has not been submitted. However the recipient intermediary will have to undertake some due diligence in respect of the intermediary providing the ARN.

National tax arrangements are not subject to report under EU DAC6. There are different reporting arrangements for certain national tax arrangements.

There are no deviations from the directive.

Yes, only cross-border arrangements concerning hallmark D must be reported.

There are no deviations from the directive (though only hallmark D is reportable).

There are no deviations from the directive.

For the purpose of the main benefit test, "tax advantage" is defined as including: 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 payment of tax or advancement of repayment of tax, andf) 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.

There are no deviations from the directive, other than that only those exhibiting hallmark D need to be reported

There is no white list.

There are no deviations from the Directive.

A sample of the guidance is: "An arrangement can be made available to a relevant taxpayer in many different ways. A taxpayer could approach a promoter seeking advice or ideas, and the promoter could make available an arrangement in response to that request. Equally, an arrangement could be made available in the course of other work between an intermediary and a client, if, for example, the intermediary identifies a potential need, and suggests the arrangement as a solution. Equally, an arrangement could be proactively made available to prospective clients through a marketing campaign."

An extract from the guidance is: "An arrangement could be ready for implementation before it is made available for implementation. This could be the case if a promoter has finalised the design of an arrangement, but decided not to promote it to potential clients until a later date, for example, because the arrangement relied on legislation which had not yet come into force. If the arrangement is sufficiently finalised that it could be implemented by a client, then it will meet this test."

HMRC guidance comments "When the first step of an arrangement is implemented is a question of fact."

There are no deviations from the directive

There are no deviations from the directive

There are no deviations from the directive.

There are no deviations from the directive.

There is no specific guidance.

2/28/2021

1/30/2021

30 days in line with the directive.

'There are penalties for primary failures as follows: 1. Failure of an intermediary to comply with the initial reporting obligation for an intermediary.2. Failure of an intermediary to comply with the quarterly reporting obligation for marketable arrangements3. Failure of a relevant taxpayer to comply with the initial reporting obligation4. Failure of an intermediary to notify an intermediary or relevant taxpayer where legal professional privilege applies.5. Failure to notify an arrangement reference number to other intermediaries and relevant taxpayers within 30 days of receipt of the arrangement reference number.6. Failure to comply with a requirement to provide information or documents as reasonably requested by HMRC.

'The default position for a primary failure is a one-off penalty of no more than £5,000. If the penalty is considered inappropriately low, HMRC can apply to a Tribunal for a higher penalty of up to £1m. A daily penalty for continuing failure can apply of up to £600 per day. A separate regime applies for a failure to make an annual report under regulation 5. These penalties are set out in regulation 14(6). Any such penalty must not exceed the relevant sum. The relevant sum is £5,000 in the case of a first failure within 36 months, £7,500 for a second failure and £10,000 in the case of a third failure and any subsequent failure during that period.The period is the 36 month period prior to the date on which the failure in question began. The previous failures do not have to relate to the same reportable cross-border arrangement.

To the extent that the penalty relates to a failure of a relevant taxpayer rather than an intermediary, yes.

There are no penalties for redundant reports.

There are limits expressed for each penalty, but the actual amount of penalty is at the discretion of HMRC or the Tribunal as appropriate.

The penalties do not differ.

No other disclosure regimes exist, unless the arrangement has a main tax avoidance purpose (in relation to UK taxes) and meets certain specified criteria (the DOTAS regime principally for direct taxes, or DASVOIT regime for indirect taxes.

The only other deviation from the Directive is that the UK applies the rules to 'states' defined as EU member states and the UK.

HM Revenue and Customs

A relevant taxpayer using a cross border arrangement must include disclosure of the use of that arrangement on their annual tax return for the year in which the arrangement was made available to them, and in each subsequent year in which it is used. Intermediaries must report every three months on any clients who use marketable arrangements.

The intermediary has the primary obligation to report. There are also on-going obligations on the relevant taxpayer to report. There is nothing requiring the reporting of legally professional privileged information, but an intermediary with legal professional privilege is required to inform any other intermediary, or if none, the relevant taxpayer of the obligation to report.

No.

Professional privilege.

There is no guidance.

Privilege applies to advice given by external lawyers and also by in-house lawyers, provided that they act in their capacity as lawyer and not in an executive or compliance capacity and are qualified to practise under the rules of the regulator, which in England and Wales means the Solicitors Regulation Authority (SRA) or the Bar Council. For solicitors this means holding a current practising certificate. Privilege extends to employees such as legal executives, trainee solicitors and paralegals provided that they are supervised by qualified lawyers. Privilege will also extend to the advice given by foreign lawyers, provided they are acting in their professional capacity in connection with the provision of legal advice. It is not necessary or relevant to consider the training and experience of an individual foreign lawyer in order for legal advice privilege to apply in the case of a foreign lawyer - legal privilege should apply to anyone who acts as a lawyer in a foreign jurisdiction. Privilege does not apply to other professionals such as accountants giving legal advice.

“privileged information” means information with respect to which a claim to legal professional privilege, or, in Scotland, to the confidentiality of communications, could be maintained in legal proceedings. It refers to discussions between a lawyer and their client.

Nothing in the UK EU DAC6 Regulations requires a UK intermediary to disclose any privileged information. Subject to this proviso, a UK intermediary must notify any other intermediary, or, if none, the relevant taxpayer, as soon as reasonably practicable of the reporting obligations of a UK intermediary or a UK relevant taxpayer as the case may be, in relation to the reportable cross-border arrangement to which the privileged information relates.

In the UK legal professional privilege operates between the client and their lawyer until it is waived by the client.