HMRC is consulting until 27 August on draft regulations (the Double Taxation Dispute Resolution (EU) Regulations 2019) to implement in the UK the new Directive on tax dispute resolution mechanisms in the EU. The directive comes into effect on 1 July 2019 and will apply to disputes involving tax years beginning on or after 1 January 2018.
Council Directive (EU) 2017/1852 of 10 October 2017 (bit.ly/2Xsnepi) introduces a mutual agreement procedure for resolving disputes within two years, after which an advisory commission can be set up to deliver an opinion within 6 months. Under the new mechanism:
taxpayers facing tax disputes arising from bilateral tax agreements or conventions providing for the elimination of double taxation can now initiate a mutual agreement procedure for resolution of the dispute within two years;
if no solution has been found at the end of this two-year period, the taxpayer can request the setting up of an advisory commission to deliver an opinion;
this advisory commission, comprised of three independent members appointed by the member states concerned and the competent authorities in question, must deliver an opinion within 6 months, to be carried out by the member states concerned unless they agree to another solution within six months following the opinion; and
if the decision is not implemented, the taxpayer who has accepted the final decision and renounced his right to domestic remedies within 60 days from notification may seek to enforce its implementation before the national court.
EU Taxation Commissioner, Pierre Moscovici, said: ‘A fair and efficient tax system in the EU should also ensure that the same revenue is not taxed twice by two different Member States. When that happens, the problem should be solved swiftly and efficiently. From today, resolving tax disputes will be a lot easier. Companies, in particular small businesses, and individuals that may be experiencing cash flow problems as a result of double taxation will see their rights considerably enhanced’.
HMRC is consulting until 27 August on draft regulations (the Double Taxation Dispute Resolution (EU) Regulations 2019) to implement in the UK the new Directive on tax dispute resolution mechanisms in the EU. The directive comes into effect on 1 July 2019 and will apply to disputes involving tax years beginning on or after 1 January 2018.
Council Directive (EU) 2017/1852 of 10 October 2017 (bit.ly/2Xsnepi) introduces a mutual agreement procedure for resolving disputes within two years, after which an advisory commission can be set up to deliver an opinion within 6 months. Under the new mechanism:
taxpayers facing tax disputes arising from bilateral tax agreements or conventions providing for the elimination of double taxation can now initiate a mutual agreement procedure for resolution of the dispute within two years;
if no solution has been found at the end of this two-year period, the taxpayer can request the setting up of an advisory commission to deliver an opinion;
this advisory commission, comprised of three independent members appointed by the member states concerned and the competent authorities in question, must deliver an opinion within 6 months, to be carried out by the member states concerned unless they agree to another solution within six months following the opinion; and
if the decision is not implemented, the taxpayer who has accepted the final decision and renounced his right to domestic remedies within 60 days from notification may seek to enforce its implementation before the national court.
EU Taxation Commissioner, Pierre Moscovici, said: ‘A fair and efficient tax system in the EU should also ensure that the same revenue is not taxed twice by two different Member States. When that happens, the problem should be solved swiftly and efficiently. From today, resolving tax disputes will be a lot easier. Companies, in particular small businesses, and individuals that may be experiencing cash flow problems as a result of double taxation will see their rights considerably enhanced’.
