The Recovery of Foreign Taxes Regulations 2007

Explanatory Note

(This note is not part of the Regulations)

These Regulations in conjunction with section 175 of the Finance Act 2006 make provision for the recovery of foreign taxes in the United Kingdom on behalf of a foreign territory.

Regulation 1 provides for citation and commencement.

Regulation 2 provides for interpretation.

Regulation 3 provides what amounts to a relevant foreign tax claim for the purposes of a claim under United Kingdom law. Further it provides that the Commissioners may take enforcement action to recover such a claim.

Regulation 4 lays down rules on how a request for recovery of foreign tax should be made.

Regulation 5 lays down the procedure to be used by the Commissioners on receipt of request for recovery.

Regulation 6 lays down further procedural provisions.

Regulation 7 lays down rules relating to whom the Commissioners may communicate the documents sent to them.

Regulation 8 lays down rules for procedures to be used where claims are adjusted.

Regulation 9 lays down rules relating to the cancellation and payment of claims.

Regulation 10 lays down rules on the procedures to be used when a claim is contested or disputed.

Regulation 11 lays down rules relating to claims which have been determined in the taxpayer’s favour.

Regulation 12 lays down provisions in relation to limitation. It is worth noting that some arrangements relating to international tax enforcement made under section 173(1) of the Finance Act 2006 provide that the relevant limitation periods are determined by the laws of the requested state rather than that of the applicant state as is currently provided for in regulation 12. Regulation 12 should therefore be read in conjunction with section 173(1) of the Finance Act 2006 which provides that such a provision in an arrangement relating to international tax enforcement would override the effect of regulation 12.

Regulation 13 lays down provisions in relation to interest.

Regulation 14 lays down rules relating to the evidence required for the enforcement of corresponding foreign claims.

Regulation 15 makes provision relating to enforcement in Scotland.

A full regulatory impact assessment has not been produced for this instrument as no impact on the private or voluntary sector is foreseen.