Information about when the 2018 UK DTA comes into effect.
The 2018 UK DTA came into effect in Guernsey in respect of income tax on the 1 January 2020 following the exchange of written notes being completed on 7 January 2019. The exchange of letters regarding assistance in collection was completed on 16 December 2021, resulting in Article 27 coming into effect from 1 January 2022.
Explanatory Note re Article 4(3) ("Resident") of the 2018 UK DTA
Article 4(3) of the 2018 UK DTA reads:
"Where by reason of the provisions of paragraph 1 a person other than an individual is a resident of both Territories, the competent authorities of the Territories shall endeavour to determine by mutual agreement the Territory of which such person shall be deemed to be a resident for the purposes of this Agreement, having regard to its place of effective management, the place where it is incorporated or otherwise constituted and any other relevant factors. In the absence of a mutual agreement by the competent authorities of the Territories, the person shall not be considered a resident of either Territory for the purposes of claiming any benefit provided by this Agreement except those provided by Articles 22, 24 and 25."
The competent authorities of Guernsey and the United Kingdom have reached agreement on how to deal with companies whose residence status was considered under the terms of the 1952 UK DTA (Article 2(1)(g) of which included a "tie breaker" clause that determined residence to be:
"a company shall be regarded as resident in the United Kingdom if its business is managed and controlled in the United Kingdom and as resident in Guernsey if its business is managed and controlled in Guernsey.")
The agreement now reached is that, where the facts and circumstances have not changed, from where the business of the company is managed and controlled was considered, and residence determined accordingly, under the 1952 UK DTA, the competent authorities will not seek to reconsider the position simply because of the change of test in the 2018 UK DTA, unless the arrangements were such that treaty benefits would be denied under the conditions of Article 23 ("Entitlement to Benefits") of the 2018 UK DTA.
HMRC has updated its Guidance to reflect this agreement between the Guernsey and United Kingdom competent authorities (see https://www.gov.uk/hmrc-internal-manuals/international-manual/intm120070).
Information about the UK DTA up to and including year of charge 2019:
- On 30 November 2015, HM Revenue and Customs (HMRC) announced an agreement reached with Jersey about the interpretation of paragraph 2(1)(f) of the Jersey-UK Double Taxation Arrangements (company residence tie-breaker). This view also applies to paragraph 2(1)(g) of the Guernsey-UK Double Tax Arrangement ("the DTA").
- In accordance with section 172(1) of the Income Tax (Guernsey) Law 1975 ("the Law") if the States "approves" a DTA then those arrangements have effect notwithstanding anything contained in the Law.
- We therefore confirm that following this change in interpretation of the DTA, where a company is prima facie resident in both the UK and Guernsey, it will be deemed (for the purposes of the DTA) only resident in the jurisdiction where it is managed and controlled.
- By way of example, if a holding company is incorporated in Guernsey but managed and controlled in the UK, it will be deemed resident in the UK in accordance with the revised interpretation of the DTA. It will not be chargeable to tax in Guernsey, and would not be required to submit a Guernsey company tax return in relation to its own affairs, unless it had any Guernsey source income, other than Guernsey bank interest (because it is treated as not resident in Guernsey). The company would not be required to submit a Guernsey company tax return in relation to its own affairs.
- Similarly, a UK incorporated company owned by a company which is tax resident in Guernsey will be regarded as resident only in the UK where the management and control of the company is in the UK.
Information for new residents arriving in Guernsey is available here.
Exchange of Information (EOI) Procedural Manual [1Mb]
Guernsey Competent Authority Details [174kb]
Request Template (this document may be used when making a request to Guernsey) [141kb]
Whilst the dates of the Agreements coming into force are shown, the Entry into Force Article in each Agreement should be consulted to determine from what date(s) the Agreement is effective.
A Guide to using the Mutual Agreement Procedure in Guernsey's Double Taxation Agreements A Guide to using the Mutual Agreement Procedure in Guernsey's Double Taxation Agreements [1Mb]
Full DTAs
As the later of notifications took place on 7 January 2019, the 2018 UK DTA is effective in Guernsey in respect of income tax for year of charge 2020. The exchange of letters regarding assistance in collection was completed on 16 December 2021, resulting in Article 27 entering into force with effect from 1 January 2022.
Partial DTAs
| Signed | In force with effect from | Entry into Force Article | |
| Australia [775kb] | 7 October 2009 | 24 August 2011 | Australia - Entry into Force [4kb] |
28 October 2008 28 October 2008 | 4 November 2009 4 November 2009 |
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28 October 2008 28 October 2008 | 15 January 2010 15 January 2010 |
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| 28 October 2008 3 & 24 April 2020 28 October 2008 3 & 24 April 2020 | 11 November 2009
11 November 2009
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28 October 2008 28 October 2008 | 19 November 2009 19 November 2009 |
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28 October 2008 28 October 2008 | 26 November 2009 26 November 2009 |
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26 March 2009 8 December 2021 | 10 June 2010
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| Japan [111kb] | 6 December 2011 | 23 August 2013 | Japan - Entry into Force [44kb] |
21 July 2009 16 September 2019 | 8 November 2010
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28 October 2008 28 October 2008 | 5 November 2009 5 November 2009 |
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8 October 2013 8 October 2013 19 May 2022 | 1 October 2014
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28 October 2008 28 October 2008 | 23 December 2009 23 December 2009 |
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