UK and Ecuador government representatives signed a new double tax convention on 6 August 2024.
This is the first double tax agreement between the two countries, and covers UK income tax, corporation tax and capital gains tax (and ‘identical or substantially similar taxes’ imposed after 6 August 2024).
Although based on the OECD Model Tax Convention (MTC), the agreement departs from the MTC in various sections, including the following:
Article 20 of the MTC covers the taxation of students (this is omitted from the agreement);
Article 22 of the MTC covers taxation of capital (separate to Article 13 ‘taxation of capital gains’), also not included in the agreement;
the above variations mean that the familiar ‘Article 25’ mutual agreement procedure provisions, for the resolution of treaty disputes, appears as Article 24 in the agreement. The version set out in the agreement covers the basic requirement for both parties to work collaboratively, but does not include provision for arbitration; and
the Protocol to the agreement sets out various clarifications that apply specifically for the purposes of the convention.
The OECD Model Tax Convention and commentary on the Convention are available here.
UK and Ecuador government representatives signed a new double tax convention on 6 August 2024.
This is the first double tax agreement between the two countries, and covers UK income tax, corporation tax and capital gains tax (and ‘identical or substantially similar taxes’ imposed after 6 August 2024).
Although based on the OECD Model Tax Convention (MTC), the agreement departs from the MTC in various sections, including the following:
Article 20 of the MTC covers the taxation of students (this is omitted from the agreement);
Article 22 of the MTC covers taxation of capital (separate to Article 13 ‘taxation of capital gains’), also not included in the agreement;
the above variations mean that the familiar ‘Article 25’ mutual agreement procedure provisions, for the resolution of treaty disputes, appears as Article 24 in the agreement. The version set out in the agreement covers the basic requirement for both parties to work collaboratively, but does not include provision for arbitration; and
the Protocol to the agreement sets out various clarifications that apply specifically for the purposes of the convention.
The OECD Model Tax Convention and commentary on the Convention are available here.
