IEIM101500 - Exchange of Information: Key concepts: Reciprocity 

HMRC cannot ask another jurisdiction to use powers that we do not have ourselves, or to obtain information we could not obtain ourselves under our powers in an equivalent UK scenario.

For example, in the UK Legal Professional Privilege means that a person cannot normally be compelled to disclose certain communications between themselves and their lawyer. Therefore, if a wide ranging request is made to another jurisdiction for documents and correspondence, the request should not extend to information that would be restricted by LPP in the UK.

Equally, another tax authority cannot ask HMRC to obtain information under our powers, unless they have an equivalent power; and any restrictions on their own information powers would need to be taken into account when using our own.

For obvious reasons, we cannot ask another tax authority to employ information gathering powers that we have, but they do not. As part of signing an international exchange agreement it is expected that a jurisdiction will adopt basic powers roughly equivalent to the core parts of Schedule 36 to FA08 (but, for example, they may not have data gathering powers such as those under Schedule 23 to FA11 for classes of persons).

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)