IEIM760000 - Commencement

Regulation 1 sets out the commencement provisions. The Regulations came into force on 28 March 2023 and will apply to CRS avoidance arrangements and opaque offshore structures.

• which are made available for implementation on or after 28 March 2023
• in respect of which an intermediary provides advice or assistance on or after 28 March 2023, in relation to designing, marketing, organising, making available for implementation, or managing the implementation of the arrangements.

The meaning of ‘made available for implementation’ is explained at IEIM740030.

Regulation 8 requires promoters to report any CRS avoidance arrangement where the where the arrangement was made available for implementation on or after the date of 25 June 2018, even where that that arrangement was made available before these regulations entering into force. However, any arrangement that has already been reported under the previous DAC6 regulations does not need to be reported under MDR, nor does it need to be reported if the account balance of the relevant financial account prior to the implementation of the arrangement was less than $1million(USD) (or equivalent).

Arrangements already reported under the DAC6 regulations do not have to be reported again under MDR. Similarly, there is no obligation to re-review arrangements, if reviews carried out in line with DAC 6 regulations at the time were considered complete, and this view has not changed. The one difference is that DAC6 only required reporting of cross-border arrangements defined under the EU directive as involving an EU member state or involving the UK under the UK’s regulations. MDR reporting does not have such a restriction so arrangements that may involve UK intermediaries that involve non-EU member states/or don’t involve the UK also need to be considered.

HMRC recognises that this reporting requirement poses certain challenges for intermediaries and reportable taxpayers, particularly where the first step of an arrangement was taken prior to the publication of the Regulations and guidance. HMRC acknowledges that promoters will need to look back at arrangements since 25 June 2018 to determine whether or not they are reportable under the final Regulations, and that in practice this will need to be on a best efforts basis using information available at the time of the review.

The previous DAC6 regulations were revoked on 28 March 2023. CRS avoidance arrangements and opaque offshore structures that were implemented, and the first step taken before 28 March 2023 should have been reported under these rules.