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This article discusses the circumstances in which foreign taxes can, or cannot, be collected in the UK.

There is a well-established rule that the UK courts will not entertain an action to recover taxes due to a foreign authority. This principle is, however, subject to international agreements under which the UK has agreed to collect foreign taxes:

1. Ìý

   •ÌýÌýÌýÌý the EU Mutual Assistance Recovery Directive (see below)

2. Ìý

   •ÌýÌýÌýÌý the OECD/Council of Europe Convention for Mutual Administrative Assistance in Tax Matters (see A6.1204)

The terms of a double tax treaty may also provide for each party to provide the other with assistance in the collection of taxes. The scope of such a 'mutual assistance' provision in the UK/South Africa Double Tax Convention was considered in Ben Nevis (Holdings) Ltd¹. The Court of Appeal upheld a freezing order for £7,000,000 which had been deposited in a London bank, and which the South Africa Revenue Service had asked HMRC for assistance in recovering.

The leading case on the principle