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Press Release

Japanese

December 18, 2013

Ministry of Finance

Protocol Amending Tax Convention with the United Kingdom was Signed

[Provisional translation]

On December 17(Tue.), The Government of Japan and the Government of the United Kingdom of Great Britain and Northern Ireland signed the Protocol Amending the Convention between Japan and the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gains at London.

The Protocol amends part of the current Convention, which entered into force in 2006. The Protocol expands the scope of exemption of taxes withheld at source on investment income (dividends and interest) to further promote the investment exchanges between the two countries and introduces a new article concerning taxation on business profits, as well as introduces the arbitration proceeding to the mutual agreement procedure to promote settlement of tax related disputes with respect to the Convention. The Protocol also reinforces cooperation between the tax authorities of the two countries by introducing provisions regarding assistance in the collection of taxes.

[Reference 1] Next Steps

After the necessary domestic procedures are carried out by each of the two countries (in the case of Japan, approval by the Diet will be necessary), diplomatic notes indicating the completion of respective procedures are to be exchanged. The Protocol will enter into force on the 30th day after the date of exchange of diplomatic notes. In Japan, the Protocol will be applied as follows in principle:

  • (1) with respect to taxes withheld at source, for amounts taxable on or after 1 January in the calendar year next following that in which the Protocol enters into force;

  • (2) with respect to taxes on income which are not withheld at source, as regards income for any taxable year beginning on or after 1 January in the calendar year next following that in which the Protocol enters into force.

[Reference 2] Provisions and Key Points of the Protocol

  • “Protocol Amending the Convention between Japan and the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gains”
    (Japanese / EnglishPDF(159KB / 192KB))
  • “Exchanged Notes concerning the Convention to be Amended by the Protocol Amending the Convention between Japan and the United Kingdom of Great Britain and Northern Ireland for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and on Capital Gains”
    (Japanese / EnglishPDF(66KB / 20KB))
  • Key Points of the Protocol Amending the Tax Convention with the United Kingdom