Statutory Instruments
2014 No. 1874
Capital Gains Tax
Corporation Tax
Income Tax
The Double Taxation Relief (Federal Republic of Germany) Order 2014
Made
16th July 2014
At the Court at Buckingham Palace, the 16th day of July 2014
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 2010(1), and approved by a resolution of that House.
Accordingly, Her Majesty, in exercise of the powers conferred upon Her by section 2 of the Taxation (International and Other Provisions) Act 2010, by and with the advice of Her Privy Council, orders as follows—
Citation
1. This Order may be cited as the Double Taxation Relief (Federal Republic of Germany) Order 2014.
Double taxation arrangements to have effect
2. It is declared that—
(a)the arrangements specified in the Protocol set out in the Schedule to this Order, which amend the arrangements set out in the Schedule to the Double Taxation Relief and International Tax Enforcement (Federal Republic of Germany) Order 2010(2), have been made with the Federal Republic of Germany;
(b)the arrangements have been made with a view to affording relief from double taxation in relation to capital gains tax, corporation tax, income tax and taxes of a similar character imposed by the laws of the Federal Republic of Germany; and
(c)it is expedient that those arrangements should have effect.
Richard Tilbrook
Clerk of the Privy Council
Article 2
SCHEDULE
EXPLANATORY NOTE
(This note is not part of the Order)
The Schedule to this Order contains a Protocol (“the Protocol”) which amends the Convention between the United Kingdom of Great Britain and Northern Ireland and the Federal Republic of Germany for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on Income and on Capital (“the Convention”). The Convention was scheduled to the Double Taxation Relief and International Tax Enforcement (Federal Republic of Germany) Order 2010 (S.I. 2010/2975). This Order brings the Protocol into effect.
The Convention aims to eliminate double taxation on income or gains arising in one country and paid to residents of the other country. It does this 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. It also has specific measures which combat discriminatory tax treatment and provide for assistance in international tax enforcement. The Protocol continues that approach.
The Protocol amends Article 7 (Business Profits) to bring it into line with the latest approach of the Organisation for Economic Cooperation and Development (OECD) as set out in its Model Tax Convention on Income and on Capital. Article 18 (Government Service) is amended and Article 30 (Members of Diplomatic Missions and Consular Posts) is substituted to harmonise the taxation of government service income including that of consular employees with Article 14(1)(c) of the Consular Convention of 30 July 1956 between the Federal Republic of Germany and the United Kingdom of Great Britain and Northern Ireland.
Article 1 provides for citation.
Article 2 makes a declaration as to the effect and content of the Protocol.
The Protocol will enter into force on the day on which the United Kingdom and the Federal Republic of Germany exchange instruments of ratification. It will take effect in each country as follows:
(a)in the United Kingdom:
(i)in respect of income tax and capital gains tax, for any year of assessment beginning on or after 6 April in the calendar year next following that in which the Protocol enters into force;
(ii)in respect of corporation tax, for any financial year beginning on or after 1 April in the calendar year next following that in which the Protocol enters into force; and
(b)in Germany:
(i)in respect of taxes levied for periods beginning on or after 1 January in the calendar year next following that in which the Protocol enters into force.
The date of entry into force will, in due course, be published in the London, Edinburgh and Belfast Gazettes.
A Tax Information and Impact Note has not been produced for this Order as it gives effect to a previously announced policy to enact a double taxation agreement.