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HMRC internal manual

International Exchange of Information Manual

What and how to exchange: Template for exchange of tax rulings DAC 3

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


Guidance for completing the template

Section 1 - Clearance Officer’s Contact Details

This information is required so JITSIC can contact the relevant officer if additional information about the clearance is required eg if JITSIC receive a follow-up request from the overseas jurisdiction. 

Section 2 - UK Taxpayer Details

Completion of this Section is mandatory and important to ensure accuracy.  Whilst a description of the Main Business Activity is not compulsory, it would be useful to have this information for profiling purposes.

Section 3 - Name of MNE Group if different

Sometimes the relevant entity does not share any aspect of its name with the parent group so completing this box allows all rulings relating to the particular group to be searched for.

Section 4 - Additional Information

This information is optional under international agreements, but will increase the quality of the information available for risk assessment purposes.

Annual Turnover: Where the accounts cover a period of less than a year do not annualise the profits but put the actual amount in the turnover box and detail the accounting period in Section 11 (“Further information”).

Accounting Profit:  Use the profit before tax per the accounts and not the taxable profit figure.

Transaction Amount:   Where the clearance relates to a specific transaction (say share for share exchange) and you know the value, please include the value of the transaction.  Where the transaction relates to a loan put the value of the amount covered by the clearance, (i.e. for an ATCA the amount of the connected party debt covered by the clearance).

APE:  Where the accounting period is less than a year, please give details of the actual period in Section 11 (“Further information”).

Section 5 - The Clearance

Please use the drop down box to select whether the ruling was Granted (for the first time), Amended or Renewed. 

If the ruling/clearance was not given, you do not need to complete this template as we do not exchange the ruling.  However please consider informing JITSIC regarding a refused clearance to make a spontaneous exchange of information to an affected jurisdiction by sending the information to the mailbox with REFUSED CLEARANCE in the subject line.

If a clearance is renewed please provide the date when the original clearance was given in Section 11 (“Further information”).

If the clearance is given with no specific end date e.g. where we clear the transaction without saying by when the transaction must be completed then put “open ended” in the “To:” box.

Section 6 - Type of Ruling

Please select the type of ruling by using the drop down box.  If “other” is selected then complete the box detailed ‘If other please describe’.

Please note:  An Advanced Thin Capitalisation Agreement (ATCA) is a unilateral or bi-lateral Advanced Pricing Agreement (APA) and therefore Section 9 (“Transfer pricing rulings”) should be completed in respect of such rulings. They are not “other” rulings.

Section 7 - Summary of the Ruling

It is important that enough information is provided here to make the exchange of the information useful to our treaty partners in line with OECD guidance and the EU Directive as the information here will be used by people unfamiliar with UK legislation.

You will therefore need to provide:

  • a short summary of the issue(s) covered in the ruling and include a description of the business activities or transactions covered by the ruling, (without leading to the disclosure of any commercial, industrial or professional secret) and the key conclusions reached in issuing the ruling.  By way of example, in the case of a unilateral APA the summary could set out the type of transaction or income covered and the transfer pricing methodology agreed;
  • why the country/countries are likely to be impacted by (or interested in) the ruling from a tax risk assessment perspective;
  • how the country/countries have been identified;
  • any other information that could help the receiving tax administration risk-assess the potential tax risks posed by the ruling.

The length of the summary may vary depending on the complexity of the arrangement. The summary does not need to include legislative references unless they add to the summary.

An example might be:

  • The UK has a Controlled Foreign Companies regime where companies that are resident outside of, but controlled from the UK make profits that have been diverted from the UK then an appropriate charge is made on the first UK resident holding company.
  • A UK group with a subsidiary in Utopia applied for a ruling and HMRC agreed that the profits made by the Utopian company had not been diverted from the UK and so a Controlled Foreign Company charge did not arise to the UK group.

Section 8 - Reason for Exchange

Please select a reason from the drop down box.

If there is more than one reason choose the first one applicable from the list and put any later ones in Section 11 (“Further information”). 

For example if the UK subsidiary of a Utopian headed group enters into a unilateral advanced pricing agreement where the other entity is in Ruritania we would need to exchange with Utopia (as ultimate or immediate parent) and Ruritania (as related party with whom the taxpayer enters into a transaction covered by a ruling).  So in this example Section 8 could show ultimate parent and the other two criteria (related party and other exchange under EU Directive for Administrative Co-operation) should be listed in Section 11 (“Further information”). 

Section 9 -Transfer Pricing

Please complete this Section for all Transfer Pricing cases including Advanced Thin Capitalisation Agreements (ATCAs).

Where the clearance relates to a bi-lateral APA with a non-EU state please:

  • provide details of the request for the APA and the APA that was agreed
  • ensure that in Section 6 (see above) the Type of Ruling shows “exchange of summary information on request for bilateral or multilateral APA”.

Section 10 - Overseas Entity

This is the most important Section in the form.  The information in this Section must be completed (and, where known, please include the overseas identification number).

You must confirm why the entity is being disclosed by using the drop down box eg the immediate parent company, ultimate parent company, counter-party to the transaction etc.

JITSIC needs to know which jurisdiction(s) will be interested in the clearance information.  This will usually be the jurisdiction at the “other end” of the cross-border transaction or impacted by it.  However, under OECD rules we are also required to inform the jurisdiction(s) where the immediate and ultimate parent companies are resident.  Therefore please list all of the relevant jurisdictions in this Section.  If easier list the additional jurisdictions’ information (as required in this section) at Section 11 (“Further information”).   

Section 11 - Further Information

If an answer to an earlier question needs further explanation please select from the ‘please select an option’ drop down box the relevant Section number and then provide the further information either in text or by way of attachments.

Section 12 - Ref Given to Ruling

This will be completed by JITSIC.