HMRC has published a consultation document containing changes to some of the rules governing the taxation of interest, including withholding tax. The proposals are relevant to UK corporates and individuals and, if implemented, would affect some commonly used financing techniques.
It is unclear when the changes would become effective but legislation is expected in Finance Bill 2013.
Consulting on anti-avoidance measures is nothing new. Indeed last year’s consultation on tax treaty anti-avoidance proved so controversial the proposals were dropped. Many of these new proposals are aimed at perceived avoidance and it will be interesting to see to what extent HMRC changes its position in response to representations. What seems clear however is that the promise of a GAAR has not lessened...
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