The UK rules requiring the disclosure of arrangements which could potentially facilitate tax evasion (MDR) entered into force on 28 March 2023. The rules were adopted on 30 November 2022 through the International Tax Enforcement (Disclosable Arrangements) Regulations 2022, in replacement of the DAC6 rules which applied in the UK until the end of the BREXIT transition period. As indicated following the public consultation, the retroactive reporting period for pre-existing arrangements is brought forward to 25 June 2018 (from 29 October 2014 originally). Disclosable arrangements that are made available or implemented after 28 March 2023 must be reported within 30 days from the triggering date. Pre-existing arrangements must be reported within 180 days following the entry into force of the regulations (i.e. by 25 September 2023).

Similarly to the DAC6 rules, the MDR regulations require intermediaries incorporated, resident, or with a place of management in the UK to disclose specified arrangements to HMRC. Under a secondary reporting obligation, the disclosure requirement may be shifted to a “Reportable Taxpayer”, being a UK resident taxpayer who is either the user of or the beneficial owner under one of the specified disclosable arrangements.  

Unlike the DAC6 rules, however, disclosable arrangements under the MDR regulations are limited to (a) arrangements designed to undermine tax reporting under the CRS, and (b) the use of opaque offshore structures. CRS avoidance arrangements are defined as arrangements "for which it is reasonable to conclude that [they are] designed to circumvent [….] CRS Legislation or exploiting an absence thereof". An opaque offshore structure is defined as a passive offshore vehicle being a legal person or legal arrangement that does not carry on a substantive economic activity supported by adequate economic substance in the country of establishment. A reportable opaque structure is defined to mean one whereby "it is reasonable to conclude that it is designed to have [….] the effect of allowing a natural person to be a beneficial owner of a passive offshore vehicle, while not allowing the accurate determination of such person’s beneficial ownership, or creating the appearance that such person is not a beneficial owner". Finally, in contrast to the DAC6 rules which covered arrangements concerning either the UK or the EU, the MDR regulations do not provide for a territorial delimitation and are, thus, potentially applicable to arrangements concerning the UK or any other jurisdiction.