Section 164 | Part to be interpreted in accordance with OECD principles

(1)This Part is to be read in such manner as best secures consistency between—

(a)the effect given to sections 147(1)(a), (b) and (d) and (2) to (6), 148 , 148A , 154(5B) and 151(2), and

(b)the effect that would be given under double taxation arrangements that incorporate the OECD model in accordance with the transfer pricing guidelines.

(2)Subsection (1) has effect subject to—

section 147(1)(c) and (7) (oil-related provision to which Part does not apply),

sections 205 and 206 (rules for oil-related ring-fence trades), and

section 217(3) to (7) (provision for sales of oil),

.

(3)In this section “the OECD model” means the rules contained in Article 9 of the Model Tax Convention on Income and on Capital approved by the OECD Council on 18 November 2025, as interpreted in accordance with, or supplemented by, the OECD’s commentary on that Article, also approved on that date.

(4)In this section “the transfer pricing guidelines” means the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations 2022 published by the OECD on 20th January 2022 as interpreted in accordance with, or supplemented by, such documents as may be published by the OECD from time to time as are relevant to the application of those guidelines.

(4A)The reference to the Model Tax Convention approved on 18 November 2025, the OECD commentary approved on that date or the OECD Transfer Pricing Guidelines published on 20th January 2022, is to that document as it may be amended or replaced from time to time.

(4B)And each of those documents, and any other document referred to in subsection (4), is to be read in accordance with any reservation, declaration or election made by the United Kingdom in relation to that document.

(4C)The Treasury may by regulations make provision—

(a)for subsection (4A) not to apply in relation to any specified amendment or replacement of the OECD model or the OECD Transfer Pricing Guidelines,

(b)providing that the reference in subsection (4) to other documents is not to include any specified document, and

(c)about the effect of any provision of any document referred to in subsection (4) that has been published, amended or replaced on or after 26 November 2025 where that provision is elective (however expressed).

(5)In this section “double taxation arrangements” means arrangements that have effect under section 2(1) (double taxation relief by agreement with territories outside the United Kingdom).