By Prof Robert Anthony, Anthony & Cie
In its recent budget legislation, the UK government made a change which affects the tax paid by residents who have lived in the UK for more than 15 years while earning income from abroad. For many years, the UK has attracted a number of Asian, Middle Eastern, African, South American, European and more recently Eastern European individuals who do not have to pay tax on their worldwide income. U.S. nationals who are taxed on their worldwide income will not be as affected as others, as it is the effective rate of tax which could be an issue.
By Artur Plutowski, EFS Group Sp. z o.o.
In summary, the revision of reporting obligations under the BEPS results in the following changes to transfer pricing:
- Local file: an entity of a multinational group (annual revenue or costs above EUR 20 million) will be required to provide: a master file report containing standardised information relevant to all group members and (ii) a local file specifically related to transactions carried out by said entity.
By Graham Busch, Lawrence Grant
The past 12 months or so has seen some of the most significant developments in many years affecting people coming to live in the UK or investing in the UK. These include:
- An end to the long-term non-domiciled status
- Tax on the gains on all sales of residential properties
- See through for Inheritance Tax on UK residential properties held in offshore companies
- Main residence election
- Some good news
By Raghu Marwah, R N MARWAH & CO LLP
On 9 July 2015, India entered into an Inter-Governmental Agreement (IGA-1) with the United States of America under which it has been agreed to share data on a reciprocal basis with regard to the financial holdings and interests of U.S. residents in India and Indian nationals in the USA. Similarly, on 3 June 2015, the Indian government signed the OECD’s Multilateral Tax Treaty aimed at establishing a Common Reporting Standard for all partner jurisdictions. But what is FATCA and why does it sound so alarming?
By Graeme Saggers, Nolands
The introduction of a withholding tax on interest paid to non-residents in South Africa was first announced in 2012. Since then it has seen a number of delays as legislation and systems have been refined. However, it finally came into official effect on 1 March 2015. The withholding tax is applied to all interest to foreign residents (excluding those with permanent establishments in South Africa or who are present in South Africa for more than 183 days in a year) which was or is paid or became due and payable after 1 March 2015.
By Artur Plutowski, EFS Group Sp.z.o.o.
Last year the European Court of Justice (ECJ) issued a judgement in case DFA Investment Trust Company vs. the Head of Tax Chamber in Bydgoszcz (C190/12). Generally, the case concerned investment funds benefiting from exemption in income tax (CIT). In particular, it referred to whether such exemption may depend on where the registered office of the investment fund is located.
By Oliver Biernat, Benefitax GmbH
High-income earners working for several entities of international groups in different countries may profit from a salary split. Normally the salary is paid in the home country only and the involved group countries split or reimburse the costs among each other. An interesting alternative is to have several labour contracts with each respective group company the employee works for on a regular basis (salary split).
By Thomas Brunner, Swiss Trust Company Ltd.
Like many other countries, Switzerland generally taxes resident individuals on their worldwide income. The income is taxed at federal level, cantonal level and communal level. The cantons and their communes independently determine the tax rates within the constitutional principles. Wealth, gift and inheritance taxes are imposed on a cantonal and communal level, but not on a federal level.
By Graeme Saggers, Nolands SA
Section 31 of the Income Tax Act, which addresses transfer pricing in South Africa, was recently amended and has been in effect as of March 2014. Prior to that, the law included a 3:1 ratio of loan-to-equity safe harbour provision, which meant that the interest incurred by a South African company on the portion of a loan that exceeded three times the value of equity would be deemed to be excessive.
By Henry Charles, Citroen Wells Chartered Accountants
The European Commission is consulting in order to collect information on the progress made in European Union (EU) countries in tackling cross-border inheritance tax (IHT) problems. What is the problem? In the EU some people can effectively pay IHT twice or more in different countries. Why is that? EU countries have to respect EU treaties and in particular are not allowed to discriminate against EU citizens when imposing IHT. However, they are not obliged to harmonise or coordinate their policies on IHT and two or more countries can impose their taxes in parallel.