Income Tax Act 2007 section 912

Power to make directions disapplying section 911

Section 912 gives an officer of Revenue and Customs the power to direct that the reduced treaty rate of tax deduction under section 911 should not apply to royalty payments, where the officer is not satisfied that the payee is entitled to double taxation relief.

• Where HMRC is not satisfied that the recipient of royalty payments will be entitled to relief under double taxation arrangements, the officer may intervene
• The officer can direct the paying company that section 911 (which allows deduction at the lower treaty rate) does not apply to one or more royalty payments
• If such a direction is made, the company must instead deduct income tax at the basic rate from the royalty payments under the normal rules in Chapters 6 or 7
• Any direction given can be varied or revoked by a later direction from an officer of Revenue and Customs