Statutory Instruments
2014 No. 3274
Capital Gains Tax
Corporation Tax
Income Tax
Petroleum Revenue Tax
The Double Taxation Relief and International Tax Enforcement (Canada) Order 2014
Made
10th December 2014
At the Court at Buckingham Palace, the 10th day of December 2014
Present,
The Queen’s Most Excellent Majesty in Council
A draft of this Order was laid before the House of Commons in accordance with section 5(2) of the Taxation (International and Other Provisions) Act 2010(1) and section 173(7) of the Finance Act 2006(2) and approved by a resolution of that House.
Accordingly, Her Majesty, in exercising the powers conferred upon Her by section 2 of the Taxation (International and Other Provisions) Act 2010 and section 173(1) to (3) of the Finance Act 2006, by and with the advice of Her Privy Council, orders as follows—
Citation
1. This Order may be cited as the Double Taxation Relief and International Tax Enforcement (Canada) Order 2014.
Double taxation and international tax enforcement arrangements to have effect
2. It is declared that—
(a)the arrangements specified in the Protocol set out in Part 1 of the Schedule to this Order and in the Interpretative Protocol set out in Part 2 of that Schedule, which further vary the arrangements set out in the Schedule to the Double Taxation Relief (Taxes on Income) Order 1980(3), have been made with the Government of Canada.
(b)the arrangements have been made with a view to affording relief from double taxation in relation to capital gains tax, corporation tax, income tax and petroleum revenue tax and taxes of a similar character imposed by the laws of Canada and for the purposes of assisting international tax enforcement; and
(c)it is expedient that those arrangements should have effect.
Richard Tilbrook
Clerk of the Privy Council
Article 2
SCHEDULE
PART 1
PART 2
EXPLANATORY NOTE
(This note is not part of the Order)
Part 1 of the Schedule to this Order contains a Protocol (“the amending Protocol”) which further amends a convention between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Canada (“the Convention”). Part 2 of the Schedule to this Order contains an Interpretative Protocol which clarifies the intended interpretation of particular aspects of the amending Protocol.
The Convention was scheduled to the Double Taxation Relief (Taxes on Income) (Canada) Order 1980 (S.I. 1980/709) and has previously been amended by the arrangements set out in the Schedules to the Double Taxation Relief (Taxes on Income) (Canada) (No. 2) Order 1980 (S.I. 1980/1528), and the Double Taxation Relief (Taxes on Income) Canada Orders of 1985 (S.I. 1985/1996) and 2003 (S.I. 2003/2619).
The Convention aims to eliminate the double taxation of income and gains arising in one country and paid to residents of the other country. This is done by allocating the taxing rights that each country has under its domestic law over the same income and gains, and/or by providing relief from double taxation. There are also specific measures which combat discriminatory tax treatment and provide for assistance in international tax enforcement. The amending Protocol continues this approach.
Article 2 makes a declaration that it is expedient that the amending Protocol and Interpretative Protocol should have effect. Amendments are made to Articles of the Convention relating to business profits, shipping and air transport, associated enterprises, dividends, interest, royalties, dependent personal services, government service, elimination of double taxation, exchange of information and the mutual agreement procedure. The general definitions Article is also amended to extend the meaning of “person” in the Convention to include partnerships, and the meaning of “resident of a Contracting State” is amended. An Article on assistance in the collection of taxes is added to the Convention.
The amending Protocol to the Order will enter into force on the date of the later of the notifications by each country of the completion of its legislative procedures. It will take effect in each country as follows:
(a)in the United Kingdom:
(i)in respect of tax withheld at source, on amounts paid or credited to non-residents on or after the first day of January in the calendar year next following the date on which the amending Protocol enters into force;
(ii)in respect of income tax and capital gains tax, for any year of assessment beginning on or after 6th April next following the date on which the amending Protocol enters into force; and
(iii)in respect of corporation tax, for any financial year beginning on or after 1st April next following the date on which the amending Protocol enters into force;
(b)in Canada:
(i)in respect of tax withheld at source, on amounts paid or credited to non-residents on or after the first day of January in the calendar year next following the date on which the amending Protocol enters into force; and
(ii)in respect of other Canadian tax, for taxation years beginning on or after the first day of January in the calendar year next following the date on which the amending Protocol enters into force.
The date of entry into force will in due course be published in the London, Edinburgh and Belfast Gazettes.
A Tax Information and Impact Note has not been produced for this Order as it gives effect to a previously announced policy to enact a double taxation agreement.
S.I. 1980/709; the arrangements scheduled to that Order were amended by the arrangements set out in the Schedules to S.I. 1980/1528, S.I. 1985/1996, and S.I. 2003/2619.