UK Mandatory Disclosure Rules guidance is published

HMRC have now published guidance relating to UK MDR.

UK MDR guidance published

HMRC have now published guidance on the reporting of Common Reporting Standard (CRS) avoidance arrangements and opaque offshore structures under Mandatory Disclosure Rules (MDR) which come into force from 28 March 2023. As reported in our article of 23 January 2023, the existing regulations covering the disclosure of cross-border arrangements under DAC6 will be repealed and replaced with disclosure obligations based on the OECD's model mandatory disclosure rules with a look-back period to 25 June 2018.

The guidance confirms HMRC’s previous comments that existing guidance on disclosing cross-border avoidance arrangements and obscuring beneficial ownership will continue to apply under MDR. The guidance does not cover several points which HMRC are expected to clarify in future guidance, which is expected before the end of March. We understand the guidance will be updated to also address the following:

  • The concept of ’potential user’, with the guidance confirming that there should be a clear link between the reportable taxpayer and the arrangement.
  • The definition of opaque offshore structures, and when widely held investments and trusts might be considered to obscure beneficial ownership; and
  • Details around the meaning of UK connection, including what is meant by residence and place of management for intermediaries and taxpayers.
Alongside the guidance, HMRC have also published supporting documents to assist entities preparing to file returns under MDR. As reported in our January article, there is to be no online manual data entry option for filing under MDR. Instead, all reports will have to be uploaded using the XML file format. HMRC have confirmed that the existing DAC6 reporting portal will remain open for one month to allow arrangements entered into before 28 March 2023 to be reported under DAC6.

Reportable arrangements entered into after this date must be reported within 30 days of implementation. Arrangements made available or implemented in the period 25 June 2018 to 28 March 2023, which were not reportable under DAC6, must be reported by 24 September 2023.


With the start date fast approaching, we hope that HMRC will issue guidance to address the gaps sooner rather than later.