In response to
the HMRC consultation on hybrids and other mismatches, the CIOT supports the broad change proposed under the
double-deduction rules which would enable inclusion/no-deduction income to be
treated in the same way as dual-inclusion income for the purposes of the double-deduction
mismatch rules. This would be the preferred approach, according to the CIOT,
and consistent with the policy objectives of both the UK anti-hybrid rules and
OECD principles to ensure deductions do not exceed corresponding income subject
to tax.
Considering the
acting together test in TIOPA 2010 s 259ND(7), the CIOT supports an amendment
to the rules to address the main concern that the test creates difficulty for
third-party lenders, such as funds investing in debt instruments in private
equity and venture capital-backed companies.
In response to
the HMRC consultation on hybrids and other mismatches, the CIOT supports the broad change proposed under the
double-deduction rules which would enable inclusion/no-deduction income to be
treated in the same way as dual-inclusion income for the purposes of the double-deduction
mismatch rules. This would be the preferred approach, according to the CIOT,
and consistent with the policy objectives of both the UK anti-hybrid rules and
OECD principles to ensure deductions do not exceed corresponding income subject
to tax.
Considering the
acting together test in TIOPA 2010 s 259ND(7), the CIOT supports an amendment
to the rules to address the main concern that the test creates difficulty for
third-party lenders, such as funds investing in debt instruments in private
equity and venture capital-backed companies.
