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HMRC internal manual

Debt Management and Banking Manual

Debt and return pursuit: foreign cases: Mutual Assistance in the Recovery of Debt (MARD) (non-EU countries): what is MARD?

What is MARD?

MARD is an arrangement which allows certain countries to ask HMRC for assistance in:

  • obtaining information
  • serving legal documents or
  • recovering a tax or duty debt

where the defaulting taxpayer is living in the UK. The arrangement is reciprocal, and is a separate arrangement to EU Mutual Assistance under the ‘MARD’ - the Mutual Assistance Recovery Directives.

This guidance refers only to the arrangements with certain countries that are not members of the European Union (EU) (see DMBM560230).

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

For guidance on the ‘MARD’ arrangements with countries that are within the EU, see DMBM560000.[]()

MARD is an important tool in combating non-payment of taxes by businesses or individuals moving from one country to another. All foreign tax debts referred under these arrangements are recovered in the same way as UK income tax debts.

There are two sources for these arrangements:

  • Council of Europe (CoE)/Organisation for Economic Co-operation and Development (OECD) Convention; and
  • a bilateral arrangement, typically an Article within a Double Taxation Agreement.

The Law and Regulations

Legislation that applies to both routes

  • Sections 173 and 175 Finance Act 2006; and
  • SI 3507/07 ‘The Recovery of Foreign Taxes Regulations 2007’
  • SI 794/10 the Recovery of Foreign Tax (Amendment) Regulations 2010.

Council of Europe/OECD Convention

The CoE / OECD Convention on Mutual Administrative Assistance in Tax Matters sets out the basis for the agreement.

This Convention is given effect in UK law by SI 2126/07 ‘The International Mutual Administrative Assistance in Tax Matters Order 2007’.

It came into force in the UK on 1 May 2008.

Double Taxation Agreements

The documents which set up the basis for the arrangement are typically either:

  • a Double Taxation Agreement (DTA) between the UK and the foreign country; or
  • a Protocol amending the DTA to include debt recovery provisions if these were not covered by the DTA when it was first signed.

The DTA and any protocol are given effect in UK law by means of a Statutory Instrument. (This content has been withheld because of exemptions in the Freedom of Information Act 2000)  

Memorandum of Understanding / Mode of Application

In addition, the operational detail of how assistance will be given is agreed and set out in the form of a Memorandum of Understanding (MOU) or Mode of Application (MOA).