IEIM622040 - Exclusions

On 28 March 2023 this legislation was repealed and replaced by the Mandatory Disclosure Rules legislation. Please refer to the guidance at IEIM700000 – Mandatory Disclosure Rules Legislation. The disclosable arrangements legislation (DAC6) will be withdrawn on 31 March 2024.

A relevant taxpayer who would otherwise have a reporting obligation under regulation 4(1) will be exempt from reporting if either of the conditions in regulation 4(3) is met. The conditions are that either:

  • The relevant taxpayer has a reporting obligation in an EU member State in respect of the same reportable cross-border arrangement, and that member State features before the UK when applying the list in Article 8ab(7) of the DAC, or
  • Another relevant taxpayer agreed the arrangement with the intermediary, or, where there is no agreement with an intermediary, another relevant taxpayer manages the implementation of the arrangement.

The amending regulations in SI 2020/1649 continue to permit an exemption from reporting in the UK where a report has been made in another implementing jurisdiction.

The exclusion only applies where the relevant taxpayer has evidence that the information they are required to report has been reported in the EU member State, or has been reported by the other relevant taxpayer.

Where a relevant taxpayer has obligations to file information in multiple States, the DAC provides that they are only required to file the information in the State which appears first in the list in Article 8ab(7) of the DAC. The list is reproduced below:

(a) the Member State where the relevant taxpayer is resident for tax purposes;

(b) the Member State where the relevant taxpayer has a permanent establishment benefiting from the arrangement;

(c) the Member State where the relevant taxpayer receives income or generates profits, although the relevant taxpayer is not resident for tax purposes and has no permanent establishment in any Member State;

(d) the Member State where the relevant taxpayer carries on an activity, although the relevant taxpayer is not resident for tax purposes and has no permanent establishment in any Member State.

As a result of the amendments in SI 2020/1649, references in the Directive to a ‘member state’ are to be read as if they were references to a ‘state’, where ‘state’ is defined as being the UK or an EU member state.

If there is more than one relevant taxpayer participating in the reportable arrangement, then the report should be made by the relevant taxpayer which agreed the arrangement with an intermediary (if there is one), or if there is no such agreement, by the relevant taxpayer which manages the implementation of the arrangement.

In such a situation the other relevant taxpayers will not have to report if they have evidence that the information they are required to report has been reported already by another relevant taxpayer. For guidance on how relevant taxpayers can obtain evidence that the required information has been reported, see IEIM659010.