Exemption from UK withholding tax on interest and royalty payments made to an associated EU resident company before 1 June 2021 [Archived]

The following Tax practice note provides comprehensive and up to date legal information covering:

  • Exemption from UK withholding tax on interest and royalty payments made to an associated EU resident company before 1 June 2021 [Archived]
  • Conditions for exemption
  • Beneficial ownership
  • Exemption notice was required to pay interest gross
  • Paying royalties without deduction of tax under ITA 2007, s 914 (repealed)
  • Notification obligations
  • Interest payments
  • Royalty payments
  • Restrictions on exemption
  • Special relationship could restrict exemption
  • More...

Exemption from UK withholding tax on interest and royalty payments made to an associated EU resident company before 1 June 2021 [Archived]

ARCHIVED: This archived Practice Note provides information on the withholding tax exemption that was available for UK source yearly interest payments or royalty payments made before 1 June 2021 (or in certain cases, before 3 March 2021) to associated EU company recipients. This withholding tax exemption was repealed by section 34 of the Finance Act 2021 with effect for payments made on or after 1 June 2021 or in certain cases, on or after 3 March 2021. This Practice Note is not maintained and is for background information only. For other UK withholding tax exemptions, see Practice Note: Exemptions and reliefs from UK withholding tax on yearly interest.

This Practice Note is only relevant to UK source payments of interest and/or royalties made before 1 June 2021 or, in certain circumstances, before 3 March 2021. For more information, see: Brexit and repeal of UK legislation that gave effect to the Interest and Royalties Directive, below.

Where a UK payer and an EU recipient (in this Practice Note, the EU recipient is referred to as the EU payee) were 25% associates, the EU payee was not liable to UK income tax on the interest or royalty payment. The payment could therefore be paid gross (ie without

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