UK shares public input on mandatory tax disclosure rules

UK shares public input on mandatory tax disclosure rules

The UK government has received 20 written responses from tax and law firms on the proposed mandatory disclosure rules (MDR).

Last year, the government published for public comments a draft version of The International Tax Enforcement (Disclosable Arrangements) Regulations 2022, setting out details of the government’s proposed approach to implementation. 

The rules require taxpayers and advisers to report information to the tax authorities on certain prescribed arrangements and structures which could facilitate tax evasion. Tax authorities in implementing jurisdictions will then share this information with the tax authorities in other implementing jurisdictions where the taxpayer is resident.

Many of the responses received provided general comments on the draft regulations and the approach set out in the consultation document, before responding to specific questions raised in the consultation.

Two key areas of stakeholder interest emerged from the consultation meetings and written responses: the period for reporting of pre-existing arrangements entered into since October 29, 2014, and the availability of an online reporting system.

The government has published detailed responses to the comments received.

The regulations implementing MDR is likely to come into force in the first half of 2023. The rules are intended to replace similar EU rules, known as DAC6 (DAC6 is an EU directive on administrative cooperation), which were implemented in the UK prior to EU Exit through the International Tax Enforcement (Disclosable Arrangements) Regulations 2020.

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