UK Signs Double Tax Agreement With Taiwan

by Mary Swire, Tax-News.com, Hong Kong

25 February 2003

The UK Treasury announced on Friday that it had signed and implemented Double Taxation Agreements with Taiwan and South Africa.

The Taiwan agreement is 'a first' on two counts. Not only is it the first Double Taxation Agreement between the two countries, it is the first DTA between the UK and a country which it does not recognise. Heads of unofficial representative offices signed it. The enabling legislation was amended to pave the way for legal effect to be given to the agreement under Section 88 of the Finance Act 2002.

Pressure had been building from the British business community over some years as the economy of Taiwan has grown. Several major British companies operate there who sought to have some specific attention addressed to hitherto difficult tax problems and uncertainty. The Agreement should help secure the UK's position as the preferred location for Taiwanese investment in Europe.

The South African convention replaces an existing agreement which came into effect in 1968. It takes into account changes in the tax regimes since then in each country in accordance with best international practice.

The UK has more than 100 Double Taxation Agreements with countries across the globe, which encourage cross border economic activity within an international understanding of tax and other issues. The UK plays a key role within the OECD to promote more use of these agreements of which there are currently more than 1,300 world-wide.

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