International movements of capital: What is reportable?
The Schedule operates on the basis of describing general categories of reportable events and transactions and then providing a series of exclusions from these (see INTM700700).
FA09/SCH 17/Para 8 sets out what is meant by reportable transactions or events. The basic test is that their value must exceed £100 Million. No report is required below this limit.
The paragraph goes on to specify that above the limit only certain categories of events and transactions are reportable. These categories are
- An issue of shares or debentures by a foreign subsidiary
- A transfer by the reporting body, or a transfer caused or permitted by the reporting body, of shares or debentures of a foreign subsidiary in which the reporting body has an interest, or
- Any situation which results in a foreign subsidiary becoming, or ceasing to be, a controlling partner in a partnership.
There is a provision allowing additional categories to be specified in regulations made by HMRC. This power has not yet been exercised.
SCH 17/Para 8(3) sets out that for the purposes of the Schedule a foreign subsidiary is a controlling partner in a partnership if, whether alone or taken together with one or more other partners that are also subsidiaries, it controls the partnership.
SCH 17/Para 8 also enables HMRC to make regulations about how the value of an event or transaction is to be determined for the purposes of the reporting requirement. The relevant legislation forms part of S.I. 2009 / No. 2192 (see INTM700900).
There is also a power in SCH 17/Para 8(7) enabling HMRC to increase the £100 Million limit specified in the Schedule. This power has not yet been exercised.