It’s a fairly typical mix of work for us: some M&A transactions; reorganising a trade association; advising a client on the revised patent box rules; structuring a group financing company; ongoing VAT advice to a client on cross border sales of vouchers; VAT advice in respect of the acquisition and importation of some aircraft; structuring the financing of a satellite. We’ve also just signed a cooperation agreement with an international firm of transfer pricing advisers, and we’re looking to bed down that relationship.
What new development in tax has caught your eye?
I have to say the ‘enablers’ consultation document. Most people I know in tax have not peddled tax avoidance schemes but have advised clients on commercial matters that could potentially be defeated by a TAAR, or possibly the GAAR. It seems crazy to me that providing commercial advice caveated with the potential application of some incredibly widely drafted anti-avoidance rules could mean that an adviser is culpable in a similar manner to a criminal offence.
As that’s a bit obvious, I’ll add the new rules on withholding tax and royalties. Having to allocate a percentage of any royalty payment to a UK permanent establishment is a new approach which, I suspect, may cause a huge headache going forward. I also thought the manner in which the withholding tax changes were implemented was unfair. Although it was flagged to take place with effect from Royal Assent, it was suddenly changed to have immediate effect. This very nearly caught us out on a large IP settlement.
Aside from your immediate colleagues, who in tax do you most admire?
Mahmut Baran. Mahmut was a tax partner in Bird & Bird Stockholm and known as one of the leading tax advisers in Sweden. In October 2014 he was appointed a justice of the Supreme Administrative Court in Sweden. Mahmut has a Kurdish background and arrived in Sweden as a refugee aged 19 unable to speak Swedish. Whilst working, he finished high school and obtained a degree in business and economics before getting a job at the Swedish tax authority. During his time at the tax authority he obtained his law degree before moving into private practice. Truly inspirational.
What is the most challenging tax problem you have faced recently?
Every time I look at the application of the intangible fixed assets rules to partnerships/LLPs I’m left scratching my head not only as to what the rules mean but also the intention behind the legislation. The recent changes have made this worse.
What are the immediate tax concerns post-Brexit?
To my mind the economic consequences and the tax impact of these are of more concern than the obvious legislative changes, such as having to rely on treaties rather than directive. I think there will be a negative impact on the economy. We therefore need to make sure that the tax system in a post-Brexit environment helps to keep business in the UK. Having said all that, at least we won’t be in the ATAD and the CCCTB.
What’s the biggest change you have seen in practice in the last few years?
The thing I see that’s having the biggest effect on how contractual protections within deals are structured is the growth of M&A insurance – particularly tax insurance. Practice is developing both in the terms of the policies but also how the widespread use of insurance is impacting market practice on deal terms.
Finally, you might not know this about me but…
When I’m not working or acting as a taxi service for teenage children, you might find me strumming (badly) on a guitar and listening to some late 70s/80s punk or indie. I also have a penchant for old horror films.
It’s a fairly typical mix of work for us: some M&A transactions; reorganising a trade association; advising a client on the revised patent box rules; structuring a group financing company; ongoing VAT advice to a client on cross border sales of vouchers; VAT advice in respect of the acquisition and importation of some aircraft; structuring the financing of a satellite. We’ve also just signed a cooperation agreement with an international firm of transfer pricing advisers, and we’re looking to bed down that relationship.
What new development in tax has caught your eye?
I have to say the ‘enablers’ consultation document. Most people I know in tax have not peddled tax avoidance schemes but have advised clients on commercial matters that could potentially be defeated by a TAAR, or possibly the GAAR. It seems crazy to me that providing commercial advice caveated with the potential application of some incredibly widely drafted anti-avoidance rules could mean that an adviser is culpable in a similar manner to a criminal offence.
As that’s a bit obvious, I’ll add the new rules on withholding tax and royalties. Having to allocate a percentage of any royalty payment to a UK permanent establishment is a new approach which, I suspect, may cause a huge headache going forward. I also thought the manner in which the withholding tax changes were implemented was unfair. Although it was flagged to take place with effect from Royal Assent, it was suddenly changed to have immediate effect. This very nearly caught us out on a large IP settlement.
Aside from your immediate colleagues, who in tax do you most admire?
Mahmut Baran. Mahmut was a tax partner in Bird & Bird Stockholm and known as one of the leading tax advisers in Sweden. In October 2014 he was appointed a justice of the Supreme Administrative Court in Sweden. Mahmut has a Kurdish background and arrived in Sweden as a refugee aged 19 unable to speak Swedish. Whilst working, he finished high school and obtained a degree in business and economics before getting a job at the Swedish tax authority. During his time at the tax authority he obtained his law degree before moving into private practice. Truly inspirational.
What is the most challenging tax problem you have faced recently?
Every time I look at the application of the intangible fixed assets rules to partnerships/LLPs I’m left scratching my head not only as to what the rules mean but also the intention behind the legislation. The recent changes have made this worse.
What are the immediate tax concerns post-Brexit?
To my mind the economic consequences and the tax impact of these are of more concern than the obvious legislative changes, such as having to rely on treaties rather than directive. I think there will be a negative impact on the economy. We therefore need to make sure that the tax system in a post-Brexit environment helps to keep business in the UK. Having said all that, at least we won’t be in the ATAD and the CCCTB.
What’s the biggest change you have seen in practice in the last few years?
The thing I see that’s having the biggest effect on how contractual protections within deals are structured is the growth of M&A insurance – particularly tax insurance. Practice is developing both in the terms of the policies but also how the widespread use of insurance is impacting market practice on deal terms.
Finally, you might not know this about me but…
When I’m not working or acting as a taxi service for teenage children, you might find me strumming (badly) on a guitar and listening to some late 70s/80s punk or indie. I also have a penchant for old horror films.
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