Commentary

A4.445 Cross border royalty payments

Administration and compliance

A4.445 Cross border royalty payments

Payments to an overseas company with a double tax agreement with the UK

A4.445 Cross border royalty payments

Where a company pays a royalty1 from which it is required to deduct tax which is collectible under ITA 2007, ss 945–962 (Pt 15, Ch 15) or ITA 2007, ss 963, 963A (Pt 15, Ch 16) (see A4.465), and it reasonably believes that at the time the payment is made, the payee2 is entitled to relief in respect of the payment under double taxation arrangements, the company may calculate the sum to be deducted by reference to the treaty rate3.

If, despite the company's belief, the payee was not, at the time of the payment, entitled to double taxation relief, the provision authorising deduction at the treaty

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