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13175 United Kingdom - Agreement for the Exchange of Information Relating to Taxes


   
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TREATIES AND OTHER INTERNATIONAL ACTS SERIES 13175

 

 

TAXATION

Information Exchange

 

 

 

Agreement Between the
UNITED STATES OF AMERICA
and the UNITED KINGDOM OF
GREAT BRITAIN AND
NORTHERN IRELAND

 

 

Signed at Washington November 27, 2001

 

 

 

 

 

NOTE BY THE DEPARTMENT OF STATE

Pursuant to Public Law 89—497, approved July 8, 1966
(80 Stat. 271; 1 U.S.C. 113)—

“. . .the Treaties and Other International Acts Series issued
under the authority of the Secretary of State shall be competent
evidence . . . of the treaties, international agreements other than
treaties, and proclamations by the President of such treaties and
international agreements other than treaties, as the case may be,
therein contained, in all the courts of law and equity and of maritime
jurisdiction, and in all the tribunals and public offices of the
United States, and of the several States, without any further proof
or authentication thereof.”

 

UNITED KINGDOM OF GREAT BRITAIN
AND NORTHERN IRELAND

Taxation: Information Exchange

Agreement signed at Washington November 27, 2001;
Entered into force March 10, 2006.

AGREEMENT BETWEEN THE GOVERNMENT OF THE UNITED STATES OF
AMERICA AND THE GOVERNMENT OF THE UNITED KINGDOM OF GREAT
BRITAIN AND NORTHERN IRELAND, INCLUDING THE GOVERNMENT OF THE
CAYMAN ISLANDS, FOR THE EXCHANGE OF INFORMATION RELATING TO
TAXES
The Government of the United States of America and the Government of the United Kingdom
of Great Britain and Northern Ireland, including the Government of the Cayman Islands, ("the
parties"), desiring to facilitate the exchange of information relating to taxes, have agreed as
follows:
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Article 1
Scope of the Agreement
The competent authorities of the parties shall provide assistance through exchange of
information relating to the administration and enforcement of the domestic laws of the parties
concerning the taxes and the tax matters covered by this Agreement, including information that
may be relevant to the determination, assessment, verification, enforcement or collection of tax
claims with respect to persons subject to such taxes, or to the investigation or prosecution of
criminal tax evasion in relation to such persons. The territorial scope of this Agreement, in
respect of the United Kingdom, is the territory of the Cayman Islands.
Article 2
Jurisdiction
To enable the scope of this Agreement to be implemented, information shall be provided in
accordance with this Agreement by the competent authority of the requested party:
(a) without regard to whether the person to whom the information relates is, or
whether the information is held by, a resident or national of a party; and
(b) provided that the information is present within the territory, or in the
possession or control of a person subject to the jurisdiction, of the requested
party.
Article 3
Taxes Covered
The taxes covered by this Agreement are federal income taxes; provided that the types of tax
covered may be extended by agreement between the parties in the form of an exchange of
letters.
Article 4
Definitions
In this Agreement —
"competent authority" means, for the United States of America, the Secretary of the Treasury
or his delegate,
and for the Cayman Islands, the Cayman Tax Co-operation Authority or a person or authority
designated by it;
"person" means a natural person, a company or any other body or group of persons;
"tax" means any tax covered by this Agreement;
"requested party" means the party to this Agreement which is requested to provide or has
provided information in response to a request;
"requesting party" means the party to this Agreement submitting a request for or having
received information from the requested party;
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"information gathering measures" means judicial, regulatory or administrative procedures
enabling a requested party to obtain and provide the information requested;
"information" means any fact, statement, document or record in whatever form;
"items subject to legal privilege" means
(a) communications between a professional legal adviser and his client or any
person representing his client made in connection with the giving of legal advice
to the client;
(b) communications between a professional legal adviser and his client or any
person representing his client or between such an adviser or his client or any
such representative and any other person made in connection with or in
contemplation of legal proceedings and for the purposes of such proceedings;
and
(c) items enclosed with or referred to in such communications and made —
(i) in connection with the giving of legal advice; or
(ii) in connection with or in contemplation of legal proceedings and for
the purposes of such proceedings,
when they are in the possession of a person who is entitled to possession of them.
Items held with the intention of furthering a criminal purpose are not subject to legal privilege.
"criminal tax evasion" means wilfully, with dishonest intent to defraud the public revenue,
evading or attempting to evade any tax liability where an affirmative act constituting an evasion
or attempted evasion has occurred. The tax liability must be of a significant or substantial
amount, either as an absolute amount or in relation to an annual tax liability, and the conduct
involved must constitute a systematic effort or pattern of activity designed or tending to conceal
pertinent facts from or provide inaccurate facts to the tax authorities of either party.
Article 5
Exchange of Information Upon Request
1. The competent authority of the requested party shall provide upon request by the
requesting party information for the purposes referred to in Article 1. Such information
shall be exchanged without regard to whether the conduct being investigated would
constitute a crime under the laws of the requested party if it had occurred in the territory
of the requested party.
2. If the information in the possession of the competent authority of the requested party is
not sufficient to enable it to comply with the request for information, the requested
party shall take all relevant information gathering measures to provide the requesting
party with the information requested, notwithstanding that the requested party may not,
at that time, need such information for its own tax purposes.
3. If specifically requested by the competent authority of the requesting party, the
competent authority of the requested party shall provide information under this Article,
to the extent allowable under its domestic laws, in the form of depositions of witnesses
and authenticated copies of original records.
4. Each party shall ensure that its competent authority, for the purposes of this Agreement,
has the authority to obtain and provide upon request
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(a) information held by banks, other financial institutions, and any person, including
nominees and trustees, acting in an agency or fiduciary capacity;
(b) information regarding the beneficial ownership of companies, partnerships and
other persons, including in the case of collective investment funds, information
on shares, units and other interests; and in the case of trusts, information on
settlors, trustees and beneficiaries.
5. The competent authority of the requesting party shall provide the following information
to the competent authority of the requested party when making a request for information
under this Agreement in order to demonstrate the relevance of the information sought to
the request:
(a) the identity of the taxpayer under examination or investigation;
(b) the nature of the information requested;
(c) the tax purpose for which the information is sought;
(d) reasonable grounds for believing that the information requested is present in the
territory of the requested party or is in the possession or control of a person
subject to the jurisdiction of the requested party;
(e) to the extent known, the name and address of any person believed to be in
possession or control of the information requested;
(f) a declaration that the request conforms to the law and administrative practice of
the requesting party and would be obtainable by the requesting party under its
laws in similar circumstances, both for its own tax purposes and in response to a
valid request from the requested party under this Agreement.
6. The competent authority of the requested party shall forward the requested information
as promptly as possible to the competent authority of the requesting party. To ensure a
prompt response, the competent authority of the requested party shall:
(a) confirm receipt of a request in writing to the competent authority of the
requesting party, and shall notify the competent authority of the requesting party
of any deficiencies in the request within 60 days of receipt of the request;
(b) if the competent authority of the requested party has been unable to obtain and
provide the information requested within a reasonable period relative to the
nature of the request, or if obstacles are encountered in furnishing the
information, or if the competent authority of the requested party refuses to
provide the information, it shall immediately inform the competent authority of
the requesting party to explain the reasons for its inability or the obstacles or its
refusal.
Article 6
Tax Examinations (or Investigations) Abroad
The requested party may, to the extent permitted under its domestic laws, allow
representatives of the competent authority of the requesting party to enter the territory
of the requested party in connection with a request to interview persons and examine
records with the prior written consent of the persons concerned. The competent
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authority of the requesting party shall notify the competent authority of the requested
party of the time and place of the meeting with the persons concerned.
2. At the request of the competent authority of the requesting party, the competent
authority of the requested party may permit representatives of the competent authority
of the requesting party to attend a tax examination in the territory of the requested party.
3. If the request referred to in paragraph 2 is granted, the competent authority of the
requested party conducting the examination shall, as soon as possible, notify the
competent authority of the requesting party of the time and place of the examination,
the authority or person authorised to carry out the examination and the procedures and
conditions required by the requested party for the conduct of the examination. All
decisions regarding the conduct of the examination shall be made by the requested party
conducting the examination.
Article 7
Possibility of Declining a Request
1. The competent authority of the requested party may decline to assist
(a) where the request is not made in conformity with this Agreement;
(b) where the requesting party has not pursued all means available in its own
territory, except where recourse to such means would give rise to
disproportionate difficulty; or
(c) where the disclosure of the information requested would be contrary to the
public policy of the requested party.
2. This Agreement shall not impose upon a party any obligation to provide items subject to
legal privilege, nor any trade, business, industrial, commercial or professional secret or
trade process. Information described in Article 5(4) shall not by reason of that fact
alone constitute such a secret or process.
3. A request for information shall not be refused on the ground that the tax liability giving
rise to the request is disputed by the taxpayer.
4. The requested party shall not be required to obtain and provide information which the
requesting party would be unable to obtain in similar circumstances under its own laws
for the purpose of the enforcement of its own tax laws or in response to a valid request
from the requested party under this Agreement.
Article 8
Confidentiality
1. All information provided and received by the competent authorities of the parties shall be
kept confidential.
2. Information provided to the competent authority of a requesting party may not be used for
any purpose other than for the purposes stated in Article 1, without the prior consent of the
requested party.
3. Information provided shall be disclosed only to persons or authorities (including judicial,
administrative, and Congressional oversight authorities) officially concerned with the
purposes specified in Article 1, and used by such persons or authorities only for such
purposes or for oversight purposes, including the determination of any appeal. For these
purposes, information may be disclosed in public court proceedings or in judicial
proceedings.
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4. Information provided to a requesting party under this Agreement may not be disclosed to
any third party.
Article 9
Safeguards
Nothing in this Agreement shall affect the rights and safeguards secured to persons by the laws
or administrative practice of the requested party, provided and to the extent that these are not so
burdensome or time-consuming as to act as impediments to access to the information.
Article 10
Administration Costs or Difficulties
1. The requesting party shall reimburse the requested party for direct out of pocket costs of
processing each request (including direct out of pocket costs of litigation directly relating to
such request), as agreed by the parties.
2. In the event that compliance with the obligations under this Agreement occasions undue
difficulty for either party, either as a result of the number or complexity of requests, the
respective competent authorities shall consult with a view to resolving the difficulty under
Article 11.
Article 11
Mutual Agreement Procedure
Where difficulties or doubts arise between the parties regarding the implementation or
interpretation of this Agreement, the respective competent authorities shall use their best efforts
to resolve the matter by mutual agreement.
Article 12
Entry into Force
1. This Agreement shall enter into force when each party has notified the other of the
completion of its necessary internal procedures for entry into force. Upon entry into force,
it shall have effect for criminal tax evasion beginning on 1 January 2004, and with respect
to all other matters covered in Article 1 beginning on 1 January 2006.
2. Upon entry into force, the provisions of the Agreement shall have effect with respect to
criminal tax evasion for taxable periods commencing from 2004, and shall have effect with
respect to all other matters for taxable periods commencing from 2006.
Article 13
Termination
1. This Agreement shall remain in force until terminated by either party.
2. Either party may terminate this Agreement by giving notice of termination in writing. Such
termination shall become effective on the first day of the month following the expiration of
a period of three months after the date of receipt of notice of termination by the other party.
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3. A party which terminates this Agreement shall remain bound by the provisions of Article 8
with respect to any information obtained under this Agreement.
IN WITNESS WHEREOF, the undersigned, being duly authorised in that behalf by the
respective parties, have signed this Agreement.
Done at Washington, in duplicate, this twenty-seventh day of November 2001.
For the Government of For the Government of
the United States of the United Kingdom of
America: Great Britain and Northern
Ireland:


For the Governm ent of
the Cayman Islands:



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