Clause 35 of Finance Bill 2016 introduces a new targeted anti-avoidance rule for certain distributions made on a winding-up. HMRC has already received a number of clearance requests from taxpayers and has drafted a standard reply letter, which it will issue to those seeking clearance.
Clause 35 of Finance Bill 2016 introduces a new targeted anti-avoidance rule for certain distributions made on a winding-up. HMRC has already received a number of clearance requests from taxpayers and has drafted a standard reply letter, which it will issue to those seeking clearance. The letter explains HMRC’s position and outlines its view of how the new rules work, confirming that it ‘expects the vast majority of distributions in a winding up will remain to be treated as capital receipts’, as the legislation will apply ‘only where all four conditions are met’.
It is not HMRC’s general practice to offer clearances on recently introduced legislation, or where there is a main purpose test, but HMRC recognises this is an area likely to cause some uncertainty before guidance is published later this year. The standard letter can be downloaded from the ICAEW tax faculty’s website. See http://bit.ly/2bmVjeq.
Clause 35 of Finance Bill 2016 introduces a new targeted anti-avoidance rule for certain distributions made on a winding-up. HMRC has already received a number of clearance requests from taxpayers and has drafted a standard reply letter, which it will issue to those seeking clearance.
Clause 35 of Finance Bill 2016 introduces a new targeted anti-avoidance rule for certain distributions made on a winding-up. HMRC has already received a number of clearance requests from taxpayers and has drafted a standard reply letter, which it will issue to those seeking clearance. The letter explains HMRC’s position and outlines its view of how the new rules work, confirming that it ‘expects the vast majority of distributions in a winding up will remain to be treated as capital receipts’, as the legislation will apply ‘only where all four conditions are met’.
It is not HMRC’s general practice to offer clearances on recently introduced legislation, or where there is a main purpose test, but HMRC recognises this is an area likely to cause some uncertainty before guidance is published later this year. The standard letter can be downloaded from the ICAEW tax faculty’s website. See http://bit.ly/2bmVjeq.