Responses to consultation on review of double taxation treaty passport scheme

HMRC consulted between May and August 2016 on whether to renew and extend the administrative simplifications of the existing scheme. The key elements of the government’s response are:

• the scheme will be made available to all UK borrowers that have an obligation to deduct withholding tax, including UK partnerships, individuals and charities;
• transparent entities (including partnerships) will be admitted to the scheme as lenders where all of the constituent beneficial owners of the income are entitled to the same treaty benefits under the same treaty;
• sovereign wealth funds and pension funds who are utilising withholding tax treaty rates will be admitted into the scheme as lenders; and
• the scheme’s terms and conditions and guidance will be updated and published on 6 April 2017.