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Purpose, scope and audience (part 1)

Published 17 December 2025

Purpose

These guidelines aim to reduce uncertainty for multinational enterprises (MNE) by providing greater clarity and transparency of HMRC compliance expectations.

These guidelines follow Chapter 11 (‘Imported Mismatches’) of Part 6A (Taxation (International and Other Provisions) Act) 2010) (TIOPA 2010). They’re referred to here as ‘the imported hybrid mismatch rules’. They do not address the core hybrid rules at Chapters 3 to 10 of Part 6A, nor the targeted anti-avoidance rule at Chapter 13. MNE face unique challenges in meeting the requirements of the imported hybrid mismatch rules. The focus on imported hybrid mismatches recognises MNE greater difficulty of ensuring compliance.

‘Help with imported hybrid mismatches’ sets out HMRC approaches to risk assessment across a range of structures, arrangements and transactions typically seen by MNE.

These guidelines help businesses reduce uncertainty in their hybrid mismatch compliance by:

• clarifying HMRC understanding of imported hybrid mismatches and how to spot them
• setting out analysis methodologies and our preferred approach
• highlighting compliance risks that HMRC most commonly observe during analysis
• providing HMRC recommendations of best practice to enable a lower-risk approach
• highlighting areas of complexity and special transactions to watch out for, or where greater scrutiny is recommended
• providing useful information on disclosures and key steps when filing the returns
• sharing practical expectations for evidencing and documenting hybrid mismatch outcomes
• suggesting useful real-time information and records to retain

Scope

These guidelines do not consider the core hybrid mismatch rules at Chapters 3 to 10 of Part 6A, which must be considered before Chapter 11.

These guidelines are not standalone. Read guidance in  International Manual INTM550000 to INTM561700 relating to imported hybrid mismatches. INTM559000 – Hybrids: imported mismatches (Chapter 11) offers guidance on the imported hybrid mismatches legislation.  We link to the relevant guidance in the International Manual throughout these guidelines.

HMRC best practice set out in these guidelines help minimise imported hybrid mismatch compliance risk. They are based on high quality examples of compliance observed by HMRC. Risk can include the risk of error, adjustment, audit, and penalties.

Not all expectations or best practice approaches will be relevant for all businesses. Judgement on adoption of recommendations, conduct of underlying work and supporting evidence is required. The degree of work needed to support the imported hybrid mismatch position, evaluate, and mitigate risk indicators will vary. This is likely to be impacted by the:

• size and complexity of the business and group
• risk profile of the business such as level of business change
• volume and materiality of intra-group transactions in scope

The UK business is responsible for ensuring all best efforts have been made in sending a correct and complete return. Best efforts mean all efforts a prudent and reasonable person would make if they were in your position. If any uncertainty arises, the UK business should make all best efforts to resolve it before filing the tax return. Read Help ensuring documents filed with HMRC are correct and complete GfC13.

As a form of guidance, these guidelines form part of HMRC’s known position for UK businesses who need to consider whether their transactions fall within the Uncertain Tax Treatment (UTT) notification obligations. These guidelines are not, however, a replacement for existing HMRC guidance within its International Manual and do not represent any change in HMRC policy. Read the Further information — next steps, further questions and legislation (part 7) at the end of these guidelines for more information.

Examples of compliance risk included are intended to be non-exhaustive. They are based on risks commonly encountered by HMRC. No inference should be made as to the risk profile of transactions not covered by these guidelines. Inferring a low-risk rating based on these guidelines does not constitute a safe harbour nor provide certainty that an enquiry will not be undertaken by HMRC.

For any errors or adjustments identified after reading these guidelines, refer to Further information — next steps, further questions and legislation (part 7) at the end of these guidelines.

Audience  

These guidelines apply to businesses operating in the UK within the charge to Corporation Tax, with transactions potentially falling within the UK imported hybrid mismatches legislation (read Chapter 11, Part 6A, TIOPA 2010 as referenced in International Manual INTM559000 – Hybrids: imported mismatches (Chapter 11). These guidelines are for businesses with entities that may meet all six conditions set out in s259KA, Chapter 11 of Part 6A TIOPA 2010.  Within these guidelines, we refer to these as imported hybrid mismatch rules.

These guidelines are for tax specialists. Typically this includes tax professionals conducting compliance work on behalf of UK businesses, in-house or a third-party specialist. Collectively referred to as the UK business in the guidelines that follow.   

We recommend that these guidelines are read by the UK risk lead. Typically the UK risk lead is responsible for: 

• managing risk in the business
• reviewing compliance work
• signing the tax return as correct and complete

They are referred to as the ‘UK risk lead’ in these guidelines.   

The imported hybrid mismatch analysis is a question of fact.  The UK business and UK risk lead remain responsible for a return that is correct in matters of fact and law. They should ensure both:   

• key information is made available to tax specialists undertaking the analysis
• a UK risk lead review is conducted of the inputs and outcomes of the compliance activity

UK risk leads should also read Help ensuring documents filed with HMRC are correct and complete GfC13. Key information is set out in Methodology (part 3).