Annual Tax on Enveloped Dwellings and Stamp Duty Land Tax: extension of scope of reliefs from 15% rate - CIOT and STPG comments
The draft legislation largely reflects the OECD model proposed in response to BEPS Action 2 and we do not have any comments on the detail of the legislation. We took the opportunity, however, to comment on the published examples and also the further guidance on the application of the hybrid rules expected later this year.
We noted that the legislation has several requirement for judgements as to reasonableness in applying the rules and this means there is inherent uncertainty within the framework of the legislation. We said that this uncertainty makes the role of guidance particularly important in order to ensure that taxpayers are able to apply the rules with confidence and have an adequate understanding of HMRC‚ s view of the various provisions.
We also queried whether there any policy rationale or intent behind the selection of the OECD examples by HMRC to be used as the basis for its own examples. The fact that a selection has been made raises the question of why the particular examples have been chosen. For example, HMRC has not included any examples involving permanent establishments.
We asked for more examples in the complicated area of Imported Mismatches.
The full CIOT reponse canbe found here.