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Two weeks to 28 March 2019

Welcome to our latest update on recent developments in international and treasury tax of interest to multinationals operating in the UK.

UK changes definition of permanent establishment
The UK Finance Act 2019, which became law on 12 February, includes the legislation required to update UK domestic law to align with the UK’s position on the changes to the Permanent Establishment (PE) definition arising from the OECD’s Base Erosion and Profit Shifting (BEPS) project and included within the Multilateral Instrument (MLI).  This effectively expands the definition of PE in the UK which - together with forthcoming changes to many double tax treaties - is likely to result in more PEs arising. Read more.

HMRC issues guidance on withholding tax in the event of a no deal Brexit
HMRC has published guidance on the changes to tax deductions on interest, royalties and dividends (paid both by and to UK companies) if the UK leaves the EU without a deal. Read more.

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