Jul 152015
 

8140678383_b981c48d95No, it’s not really goodbye. Goodwill hasn’t gone away, it’s still there all right. A company that acquires a business is still required to write down the value of the purchased goodwill in its accounts. But from 8 July 2015, it will no longer be able to deduct the amounts written off when calculating its taxable profits.

This isn’t great news. Not great news at all – it was actually hidden away towards the bottom of the list on the relevant GOV.UK webpage. I only found it easily because I’ve got into the habit of looking for those Budget measures to be effective immediately, so I can start writing my own Budget page.

So what does it all mean? And why do I find myself laughing? Continue reading »

Corporate Tax Groups – Special rules for Investment Trusts, VCTs and REITs

 CGT, Corporate Groups, Investment Trusts, REITs, Venture Capital Schemes  Comments Off on Corporate Tax Groups – Special rules for Investment Trusts, VCTs and REITs
Feb 262015
 

It has been a while since we last discussed corporate groups, and the notion of intra-group transfers. In this article we shall look at the rules as they apply to investment trusts, VCTs, REITs and other types of company that have a special tax status.

(This article can be downloaded in pdf format at Academia.edu.)

Continue reading »

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 »