Draft Order in Council laid before the House of Commons under section 5(2) of the Taxation (International and Other Provisions) Act 2010 and section 173(7) of the Finance Act 2006, for approval by resolution of that House.

2016 No. 0000

Capital Gains Tax

Corporation Tax

Income Tax

The Double Taxation Relief and International Tax Enforcement (Turkmenistan) Order 2016

Made***

At the Court at Buckingham Palace, the *** day of ***

Present,

The Queen’s Most Excellent Majesty in Council

A draft of this Order was laid before the House of Commons in accordance with section 5(2) of the Taxation (International and Other Provisions) Act 20101 and section 173(7) of the Finance Act 20062 and approved by a resolution of that House.

Accordingly, Her Majesty, in exercising the powers conferred upon Her by section 2 of the Taxation (International and Other Provisions) Act 2010 and section 173(1) to (3) of the Finance Act 2006, by and with the advice of Her Privy Council, orders as follows—

Citation1

This Order may be cited as the Double Taxation Relief and International Tax Enforcement (Turkmenistan) Order 2016.

Double taxation and international tax enforcement arrangements to have effect2

It is declared that—

a

the arrangements specified in the Convention set out in the Schedule to this Order have been made with the Government of Turkmenistan,

b

the arrangements have been made with a view to affording relief from double taxation in relation to capital gains tax, corporation tax and income tax and taxes of a similar character imposed by the laws of Turkmenistan and for the purposes of assisting international tax enforcement, and

c

it is expedient that those arrangements should have effect.

NameClerk of the Privy Council

SCHEDULE

Article 2

EXPLANATORY NOTE

(This note is not part of the Order)

The Schedule to the Order contains a Convention (“the Arrangements”) between the Government of the United Kingdom of Great Britain and Northern Ireland and the Government of Turkmenistan dealing with the avoidance of double taxation and the prevention of fiscal evasion. The Order brings the Arrangements into effect.

The Arrangements aim to eliminate the double taxation of income and gains arising in one country and paid to residents of the other country. This is done by allocating the taxing rights that each country has under its domestic law over the same income and gains, and/or by providing relief from double taxation. There are also specific measures which combat discriminatory tax treatment and provide for assistance in international tax enforcement.

Article 1 provides for citation.

Article 2 makes a declaration as to the effect and content of the Arrangements.

Individuals entitled to the benefits of Article 15 of the Convention between the Government of the Union of Soviet Socialist Republics and the Government of the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation with respect to Taxes on Income and Capital Gains signed at London on 31st July 1985 (“the 1985 Convention”) at the time of the entry into force of this Convention shall continue to be entitled to such benefits as if the 1985 Convention had remained in force.

The Arrangements will enter into force on the date of the later of the notifications by each country of the completion of its legislative procedures. They will take effect as follows:

a

in respect of Article 23 (Mutual agreement procedure) and Article 24 (Exchange of information) from the date of entry into force of the Arrangements, without regard to the taxable year or chargeable period to which the matter relates,

b

in respect of taxes withheld at source, to amounts of income payable on or after 1st January next following the date on which the Arrangements enter into force,

c

in Turkmenistan, in respect of other taxes charged on income, for taxable periods beginning on or after 1st January next following the date of entry into force,

d

in the United Kingdom:

i

subject to paragraphs (a) and (b) above, in respect of income tax and capital gains tax, for any year of assessment beginning on or after 6th April next following the date of entry into force, and

ii

in respect of corporation tax, for any financial year beginning on or after 1st April next following the date of entry into force.

Until such time as the Arrangements enter into effect, the Agreement between the Government of the Union of Soviet Socialist Republics and the Government of the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation of Air Transport Undertakings and their Employees signed at London on 3rd May 1974 and the 1985 Convention continue to have effect insofar as that Agreement and the 1985 Convention apply to Turkmenistan.

The date of entry into force will, in due course, be published in the London, Edinburgh and Belfast Gazettes.

An Impact Assessment has not been produced for this instrument as double taxation agreements are not regulatory in nature.