UK-Germany Tax agreement
A new Double Taxation Convention between the UK and Germany was recently signed in London by the Financial Secretary to the Treasury and the German Ambassador to the United Kingdom.
The new Convention includes a protocol which updates the exchange of information clauses to bring the Convention in line with the OECD’s model. The protocol is drafted to allow for the exchange of information necessary to prevent fraud and tax evasion.
There are also some other changes including a new binding arbitration clause in the event of a protracted dispute between the German and UK tax authorities.
The new Convention will come into force once both countries have finalised the legislative procedures. The provisions will then take effect from the following calendar year. The current Convention dating back to 1964 will remain in force until the new Convention is effective.