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Period to 10 January 2019

Updates to the Diverted Profits Tax Guidance
In this article, we summarise the main updates to the Diverted Profits Tax guidance that was published on 31 December 2018. These updates may affect companies that are already discussing their arrangements with HMRC or who could potentially be within the scope of DPT.

The Profit Diversion Compliance Facility
HMRC has launched a new initiative, the Profit Diversion Compliance Facility, the details of which can be found on HMRC’s website. The PDCF is aimed at multinationals using arrangements targeted by DPT who are not currently under a DPT or TP enquiry. Read more.

Transfer pricing tax disputes - What are we seeing currently
Since the BEPS project, HMRC is now much more prepared to set quite challenging expectations of potential additional tax yield from TP or DPT enquiries, often well ahead of fully evaluated and developed technical positions. In the first two articles in this series we provided an overview of HMRC’s response to Profit Diversion, focusing on the changes we are seeing in transfer pricing disputes involving HMRC. In our next articles we want to look in a little more detail at what we are seeing and at some approaches to resolution that have proved helpful in practice. Read more.

HMRC publishes synthesised texts of tax treaties with Lithuania and Slovakia
HMRC has published the ‘synthesised’ text of the UK’s double taxation conventions with Lithuania and Slovakia as modified by the BEPS multilateral instrument (MLI). The MLI came into force for the UK on 1 October 2018 and for Lithuania and Slovakia on 1 January 2019. Read more.