FREE: Taxpayers struggling to account for UK bank levy

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

FREE: Taxpayers struggling to account for UK bank levy

UK taxpayers are experiencing a number of headaches when it comes to complying with the new bank levy, says a taxpayer at a large multinational bank.

Speaking to International Tax Review, the taxpayer, who wished to remain anonymous, flagged up the problem banks were experiencing when accounting for the levy. The main issue is that the levy applies to the global consolidated balance sheets of British banking groups and building societies, while not all the necessary information is held in the UK. This has required a lot of coordination between the bank’s branches and subsidiaries.

Another problem the taxpayer identified is that they were facing double taxation with the German bank levy.

The German levy, like the UK's, is based on liabilities, but Germany's is payable into a fund and is only levied at an entity level, excluding German branches of foreign banks. The UK's levy, by contrast, includes all banks which operate in the UK including their branches and subsidiaries based in Germany.

"Double taxation will result from the overlap of domestic measures whose scope of application has not been concerted," says Roger Kaiser, senior tax and accounting adviser at the European Banking Federation.

The taxpayer was hopeful, however, that an agreement between the UK and Germany will be reached soon to prevent them being taxed twice on the same assets and liabilities.

more across site & shared bottom lb ros

More from across our site

Tax advisers should revisit India secondment arrangements after the EY US ruling strengthened the Centrica precedent and raised fresh withholding concerns
Despite the shortfall, effective tax rates of multinationals have seen a ‘statistically significant rise’
After joining Milbank from Akin Gump, the fund tax specialist discusses sponsor demand, practice building, and the tax challenges facing asset managers
Partner payouts could also be reduced by a fifth, it has been reported
There is no logical reason not to extend an exemption from EU CFC rules to multinationals headquartered in side-by-side jurisdictions, USCIB said
While rarely the sole driver of a combination, tax is becoming an increasingly important part of firms' efforts to keep up with client expectations
New research, which suggests LLMs can silently corrupt complex documents, should alert tax and legal teams relying on AI to handle iterative drafting and compliance workflows
Maintaining increased funding for HMRC is a ‘high possibility’ if he becomes PM, ITR has also heard
Awards
ITR is delighted to reveal all the shortlisted nominees for the 2026 Europe Tax Awards
The firm has hired a team of private client lawyers from Withers to launch in New York and Connecticut, though ITR analysis suggests it faces stiff competition
Gift this article