Recently, Canada has accepted to amend the Income Tax Treaty protocol with the United Kingdom that was signed July 21, 2014. The Protocol initiates a deadline to introduce transfer pricing assessments and changes the time frame for searching competent authority support, and explains how to identify eligible person for getting the tax treaty benefits. It also removes withholding tax on interest for loans for persons those are dealing at arm’s length and cuts withholding tax on dividend for particular pension plans. In addition, they also agreed to amend the employment income tax and reviews the provision on the exchange of information to cope up with the standard developed by the OECD. The protocol should be ratified before coming into force.
