By Paul Malin, Haines Watts
HM Revenue & Customs (HMRC) in the UK are continuing their fight against all forms of tax evasion and aggressive tax avoidance. HMRC’s track record in this area is at best mixed but this may now be changing to their advantage.
By Dr. Sergio Finulli, Comma 10
The Italian tax agency's report of 19 March 2013 dealt at length with the international standard ruling procedure aimed at international companies which proposed to reach a preliminary agreement with the Italian tax authorities on
- Determining fair market value in view of the transfer price rules (Article 110 para. 7 of Presidial decree 917/86)
- The application proposed of rules also agreed for contracts in specific individual cases concerning paying or drawing dividends, interest, royalties and other elements of profits to or from non-resident rights holders;
- The application proposed for specific individual cases of rules on attributing profits or losses to the stable organisational structure of a company domiciled in the territory of another state.
By Julie Bryant, Haines Watts
In April 2013, the UK Government introduced a new incentive for innovative high-tech companies to invest in the UK. In addition to the generous tax credits already available for qualifying research and development expenditure, there is now a "Patent Box" which allows companies to benefit from a reduced corporation tax rate of 10% on profits generated from qualifying patents. This new incentive further demonstrates the UK Government's desire to make the UK an attractive place to do business, and builds on other recent initiatives such as the dividend exemption, the reformed controlled foreign company rules and the reducing main rate of corporation tax.
By Sergio Guerrero Rosas, Guerrero y Santana, S.C.
After receiving the opinion of the Commission of Finance and Public Credit, last month the Mexican Congress approved the economic package proposed by President Peña Nieto on 8 September 2013. The package includes substantial amendments to, as well as the repeal and enactment of, various tax laws. The objective of the proposal is to generate employment and support the economy through a counter-cyclical effort. However, no programmes have been created or launched to stimulate investment or employment.
The revenue that states are losing due to international tax optimization by large companies is back into the focus of the Organization for Economic Co-operation and Development (OECD). According to the OECD study "Addressing Base Erosion and Profit Shifting", multinational corporations are eroding the tax base and disproportionately shifting their profits.
By Marios Eliades, M. Eliades & Partners LLC
The House of Representatives of the Republic of Cyprus has introduced new legislation relating to the intellectual property regime, interest deductibility, group relief and deemed distribution of dividends. The new legislation became effective 1st January 2012.
The German tax regulations that govern the reinvestment of hidden reserves cannot be reconciled with European law. This at least is the opinion of the European Commission, which has therefore sued Germany in the European Court of Justice (EuGH). The suit filed before the EuGH is the final step in treaty violation proceedings.
By Graham Busch, Lawrence Grant
Come in James Bond? Shaken not stirred? Well, to be honest, the vehicle to which I refer is not 007's Aston Martin. Nothing quite so glamorous. Nonetheless, a very interesting opportunity for international traders wishing to use a UK entity that offers limited liability in a potentially (entirely) UK tax-free environment. I am talking here about the UK Limited Liability Partnership, or LLP.