Apr 132016

A major political storm is brewing in Westminster as more revelations into the tax affairs of leading public figures have come to light.

It appears that many of these figures have salted away substantial sums of money in a trust structure that allows them to draw an income tax free, and with no capital gains tax to pay when they sell their investment. Furthermore, it looks as if the taxman is letting them get away with it.

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Feb 162016

It cannot have escaped most people in the UK that Google has just done a deal with HMRC, agreeing to pay a certain amount of money as a settlement for the tax that they are said to owe the UK Government. The Government immediately hailed this as a victory, but almost everyone else is very angry because it is too little, and because Google is a wicked multinational company that doesn’t pay its fair share.

I’m beginning to think it’s déjà vu all over again. And once again, as on all the other occasions when we hear about how a Google or a Starbucks or a Vodafone is dodging its taxes, I just pull a big woollen blanket over my ears and carry on with what I was doing. Continue reading »

The Google Tax – Some (Very) Initial Thoughts by Tax Barrister Jolyon Maugham

 International Tax, Tax Avoidance  Comments Off on The Google Tax – Some (Very) Initial Thoughts by Tax Barrister Jolyon Maugham
Dec 152014

The following is a guest article written by tax barrister Jolyon Maugham, who also writes for his own tax blog Waiting for Godot. These are Jolyon’s views on the new Diverted Profits Tax (“DPT”, or “Google Tax”) that was introduced in the recent Autumn Statement. Jolyon has kindly agreed to share his initial views on Tax Notes.

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Autumn Statement 2013 – Buying Corporate Tax Losses – new rules for Holding Companies

 Corporate Groups, Corporate Tax, Tax Avoidance  Comments Off on Autumn Statement 2013 – Buying Corporate Tax Losses – new rules for Holding Companies
Jan 242014

There has been a welcome amendment to the rules that prevent the carry forward of corporate tax losses where there have been significant changes to the underlying business activities. The rules apply when a company undergoes a change of ownership, and they make perfect sense in the context of a company takeover.

However, one would not expect tax losses to be restricted when the corporate group has undergone an internal restructuring. There is less justification for this, given that a restructuring doesn’t usually result in a change in the underlying economic ownership of the assets involved.

And indeed, as we shall see, the rules don’t apply when the target is a subsidiary that is being transferred from one group company to another. Unfortunately, the exception doesn’t extend to the introduction of a new holding company.

This situation is to be remedied in the next Finance Act. The changes will take effect from 1 April 2014. Continue reading »

Autumn Statement 2013 Venture Capital Trusts and Share Buybacks

 Tax Avoidance, Venture Capital Schemes  Comments Off on Autumn Statement 2013 Venture Capital Trusts and Share Buybacks
Dec 172013

New rules are being introduced to restrict upfront relief, where an investor sells his shares back to the VCT and uses the proceeds to subscribe for another shareholding. In this way, one can have a series of share subscriptions, each one giving rise to tax relief, but with no fresh money actually going into the system and finding its way towards the high growth companies that the VCT scheme is intended to benefit.

Rules to restrict upfront relief in a share buyback situation were first mooted in the Consultation Paper earlier this summer. We now have some draft legislation, so it is now possible to explore in more detail, just how these new rules will apply.

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Vodafone and Tax Avoidance

 Corporate Tax, Tax Avoidance  Comments Off on Vodafone and Tax Avoidance
May 232013

Tax avoidance and multinational corporations have featured prominently in the news in recent weeks.

We have seen the likes of Google and Starbucks being called to appear before the Public Accounts Committee to explain their tax practices, Prime Minister David Cameron talking about the need for global action against tax evasion and aggressive tax avoidance, and even Leader of the Opposition Ed Miliband,  saying that he would rewrite the corporate tax rules (why? Doesn’t he think the new GARR will do the trick?).

Perhaps the phrase which best sums up the view of those who consider these companies to be engaging in suspect tax planning is that of Margaret Hodge, who chairs the Public Accounts Committee:

“We’re not accusing you of being illegal, we’re accusing you of being immoral”

Now it is all very well to have these debates about how and why these multinationals manage to minimise their tax bills. But what concerns me is that, reading the various press reports, it is never clear just what exactly the company involved has done that is so immoral. And if we don’t know what this is, how can we have a debate about it? Continue reading »

Budget 2013 – Buying Corporate Tax Losses – a technical analysis of the new rules on trading losses

 Budget 2013, Corporate Tax, Tax Avoidance  Comments Off on Budget 2013 – Buying Corporate Tax Losses – a technical analysis of the new rules on trading losses
Mar 262013

This is a technical analysis of the new restriction on the carry forward of trading losses when a company undergoes a change in ownership. The legislation refers to the Corporation Tax Act 2010 (“CTA 2010”).

Tax specialists will be familiar with the subject matter. For those who are not so familiar with these rules, there is another article to follow. Continue reading »

Mar 222013

There are a number of anti-avoidance measures aimed at closing various loopholes in the corporate tax legislation. These are all targeted at loss buying – on top of the loophole closures, we have two new targeted anti-avoidance rules, or TAARs as we like to call them in the tax world. Continue reading »

Mar 222013

The actual measure is aimed at certain “non-natural persons” and is stated to be a CGT measure. While CGT is one of the taxes involved in this anti-avoidance package, it is in substance a  penalty against wealthy individuals seeking to save stamp duty land tax (“SDLT”) when buying a home through an offshore company.  Continue reading »