Tax information exchange and FATCA

Tax information exchange

The exchange of information between HMRC and tax authorities in other territories is an essential tool in enabling authorities both to administer and enforce their own taxes, and to tackle avoidance and evasion. The importance of effective exchange of information has increased over the years as international trade barriers have been reduced and capital has become more mobile.

The UK historically exchanged tax-related information with foreign tax authorities on request or spontaneously, but in recent years there has been a shift towards the automatic and systematic exchange of information. Tax information may now be exchanged under one or more of the following arrangements:

1. •

   double tax treaties or conventions (DTTs)

2. •

   tax information exchange agreements (TIEAs)

3. •

   the Council of Europe/Organisation for Economic Cooperation and Development (OECD) Multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAATM)

4. •

   intergovernmental agreements implementing US Foreign Account Tax Compliance Act (FATCA), and

5. •

   the common reporting standard (CRS)

There is considerable cross over between the different ways of exchanging information. Where a state is requesting information exchange (rather than automatically exchanging it), it is