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HMRC internal manual

Bank Levy Manual

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HM Revenue & Customs
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Double Taxation Relief: Germany: subject to more than one foreign levy

Regulation 10 of SI2012/459

As many banking groups are multi-national it is possible that an entity subject to the UK bank levy may also be part of a group that is subject to two or more other levies. For example a French group may own a German bank which then trades in the UK via a Permanent Establishment.

The principle of home state primacy is adopted for double taxation relief for the bank levy. This means that where a foreign entity owns subsidiaries subject to the UK bank levy or trades in the UK via a Permanent Establishment the UK will give relief for any foreign levy charged upon entities that are subject to the UK bank levy. Where an entity is subject to the UK bank levy and two or more foreign levies, the principle of home state primacy means that relief will be given for the foreign levy charged upon the ultimate or higher parent before any intermediate or lower parent. For instance in the situation mentioned above relief will be given for the French bank levy before the German bank levy.

Where this happens, the order for relief is set out in Regulation 10.

BKLM740170 contains two examples that demonstrate how these rules work.