The government has published its summary of responses to its consultation on modernising the UK’s domestic rules to transfer pricing, permanent establishment (PE) and diverted profits tax (DPT) to improve fairness and support growth. The government confirms that:
it is bringing forward changes to legislation to make the transfer pricing rules simpler, more certain and better aligned with tax treaties;
it will continue to consider whether to align the UK domestic definition of a PE with the definition set out in Article 5 of the 2017 OECD Model Tax Convention (MTC);
it will retain the investment manager exemption and independent broker exemption;
it will revise the current domestic legislation on PE attribution contained in Chapter 4 of CTA 2009 so that it aligns with Article 7 of the OECD MTC; and
it intends to bring the DPT regime into the corporation tax framework.
Draft legislation for consultation is expected later this year.
The government has published its summary of responses to its consultation on modernising the UK’s domestic rules to transfer pricing, permanent establishment (PE) and diverted profits tax (DPT) to improve fairness and support growth. The government confirms that:
it is bringing forward changes to legislation to make the transfer pricing rules simpler, more certain and better aligned with tax treaties;
it will continue to consider whether to align the UK domestic definition of a PE with the definition set out in Article 5 of the 2017 OECD Model Tax Convention (MTC);
it will retain the investment manager exemption and independent broker exemption;
it will revise the current domestic legislation on PE attribution contained in Chapter 4 of CTA 2009 so that it aligns with Article 7 of the OECD MTC; and
it intends to bring the DPT regime into the corporation tax framework.
Draft legislation for consultation is expected later this year.
