UK and International Tax news

Double Tax Treaty Passport Scheme Update

Thursday 2nd September 2010

Further to the announcement of the introduction of a Double Taxation Treaty Passport (DTTP) Scheme for overseas corporate lenders [see our International Tax News item of 2 June 2010] with effect from 1 September 2010, HMRC has confirmed that the one-to-one loan aspect of the Provisional Treaty Relief Scheme (PTRS) is no longer needed and will be discontinued with effect from 31 August 2010, after which date no one-to-one PTRS applications can be made.

The part of the PTRS dealing with syndicated loans is being retained under the name of the Syndicated Loan Scheme (SL). The SLS enables double tax treaty relief to be given from withholding tax deductible on UK source interest paid to the lending members of a syndicate resident in countries which have double tax treaties with the UK that provide for such relief.

The SLS applies only where the borrower and the lenders are unconnected and the transaction is on arms length terms.

If you would like more details on the operation of the scheme, please contact Keith Rushen on +44 (0)20 7486 2378.

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