Tax Treaty Case Law around the Globe 2017

1. S. 280Introduction

On 30 May 2017 the Upper Tribunal reversed the decision of the First-tier Tribunal which was discussed at the conference in Vienna. The decision of the Upper Tribunal is a decision of a single judge, Mr Justice Marcus Smith, a judge who has not, as far as one can tell, ever previously decided a matter relating to a double taxation convention. It is understood that permission has now been granted for a further appeal from the decision of the Upper Tribunal.

2. Facts of the Case

The background facts are very straightforward. Mr Fowler was a resident of the Republic of South Africa for the purposes of the South Africa-United Kingdom Income and Capital Gains Tax Treaty (2002). In the UK tax years 2011-12 and 2012-13 he worked as a diver in the UK sector of the continental shelf. There was an unresolved issue as to whether he was employed or self-employed as a diver. The case was heard on a preliminary issue, without deciding that issue.

Mr Fowler claimed that he was exempt from tax under article 7 (the business profits article) of the South Africa-United Kingdom tax treaty. His claim was based on a provision of UK law which deemed the performance of the duties of employment...