One minute with Ian Ferreira is a Partner at Sullivan & Cromwell in the firm’s Tax Group.
What’s keeping you busy at work?
I’ve been at Sullivan & Cromwell a month. We’re advising on a complex SSE question for a sovereign investor, and a cross-border acquisition by a US-listed group, while working with our finance, restructuring and corporate colleagues to grow the London platform. My priority now is growing the team to keep pace with my transactional colleagues!
What do you know now that you wish you’d known at the start of your career?
Tax law evolves very quickly. While there might seem to be a gulf in expertise between junior and senior lawyers, as a junior you can get to know a new area of law and add real value to the team by speaking up and sharing your views. Being a successful tax lawyer means building relationships. Helping clients achieve their commercial goals is what ultimately matters – and remember that your colleagues of today may be your clients of tomorrow.
What new trends are you seeing in tax?
One clear trend is the increase in tax authority activity and scrutiny. HMRC and other tax authorities are willing to challenge established structures, and the courts appear more prepared to take purposive approaches to legislation. The decision in BlueCrest Capital Management is a good example of how published guidance may not always provide the certainty taxpayers expect.
Against that backdrop, tax must be more prominent within corporate governance. Boards should recognise that tax structuring cannot operate in a silo. For tax outcomes to be effective and sustainable, they need to be closely aligned with the commercial rationale for a transaction, and considered as part of the core strategic decision-making. Robust, contemporaneous evidence is critical. Tax structures need to be technically robust as well as operationally deliverable.
Are there any new rules that are causing a particular problem in practice?
The new carry rules are due to take effect from 6 April 2026. Much has already been written about the move to an income tax framework. The immediate challenge for sponsors is practical: they must be ready to operate under the new rules and have systems capable of monitoring investments, day count and carry allocations.
There are particular challenges for internationally mobile executives. Executives will need to maintain detailed records of UK workdays undertaken by carry holders, including the nature of the relevant investment management services and the funds to which they relate, to apply the 60-day rule. Individuals resident in treaty jurisdictions will look to the business profits article for protection from UK tax, and will need to determine whether they have (or have had) a UK permanent establishment.
A further area of focus is the distinction between qualifying and non-qualifying carry, given the potential for cliff-edge outcomes. The relaxation of the UK workday rules applies only to qualifying carry, so funds generating non-qualifying carry do not benefit. HMT permit a reasonable view to be taken at the outset on whether carry is expected to be qualifying; where it is reasonable to assume the carry will be qualifying, a day that would otherwise be treated as a UK workday can instead be treated as a non-UK workday.
Sponsors should note that, although the reporting obligation sits with individuals, many will require support, particularly on cross-border issues. Sponsors will need to provide guidance and ensure a consistent and defensible approach to reporting across their executive population.
You might not know this about me but...
If I weren’t a lawyer, I would want to be an airline pilot (somewhat unlikely) or, even better, an F1 driver (even less likely at this stage in life).
One minute with Ian Ferreira is a Partner at Sullivan & Cromwell in the firm’s Tax Group.
What’s keeping you busy at work?
I’ve been at Sullivan & Cromwell a month. We’re advising on a complex SSE question for a sovereign investor, and a cross-border acquisition by a US-listed group, while working with our finance, restructuring and corporate colleagues to grow the London platform. My priority now is growing the team to keep pace with my transactional colleagues!
What do you know now that you wish you’d known at the start of your career?
Tax law evolves very quickly. While there might seem to be a gulf in expertise between junior and senior lawyers, as a junior you can get to know a new area of law and add real value to the team by speaking up and sharing your views. Being a successful tax lawyer means building relationships. Helping clients achieve their commercial goals is what ultimately matters – and remember that your colleagues of today may be your clients of tomorrow.
What new trends are you seeing in tax?
One clear trend is the increase in tax authority activity and scrutiny. HMRC and other tax authorities are willing to challenge established structures, and the courts appear more prepared to take purposive approaches to legislation. The decision in BlueCrest Capital Management is a good example of how published guidance may not always provide the certainty taxpayers expect.
Against that backdrop, tax must be more prominent within corporate governance. Boards should recognise that tax structuring cannot operate in a silo. For tax outcomes to be effective and sustainable, they need to be closely aligned with the commercial rationale for a transaction, and considered as part of the core strategic decision-making. Robust, contemporaneous evidence is critical. Tax structures need to be technically robust as well as operationally deliverable.
Are there any new rules that are causing a particular problem in practice?
The new carry rules are due to take effect from 6 April 2026. Much has already been written about the move to an income tax framework. The immediate challenge for sponsors is practical: they must be ready to operate under the new rules and have systems capable of monitoring investments, day count and carry allocations.
There are particular challenges for internationally mobile executives. Executives will need to maintain detailed records of UK workdays undertaken by carry holders, including the nature of the relevant investment management services and the funds to which they relate, to apply the 60-day rule. Individuals resident in treaty jurisdictions will look to the business profits article for protection from UK tax, and will need to determine whether they have (or have had) a UK permanent establishment.
A further area of focus is the distinction between qualifying and non-qualifying carry, given the potential for cliff-edge outcomes. The relaxation of the UK workday rules applies only to qualifying carry, so funds generating non-qualifying carry do not benefit. HMT permit a reasonable view to be taken at the outset on whether carry is expected to be qualifying; where it is reasonable to assume the carry will be qualifying, a day that would otherwise be treated as a UK workday can instead be treated as a non-UK workday.
Sponsors should note that, although the reporting obligation sits with individuals, many will require support, particularly on cross-border issues. Sponsors will need to provide guidance and ensure a consistent and defensible approach to reporting across their executive population.
You might not know this about me but...
If I weren’t a lawyer, I would want to be an airline pilot (somewhat unlikely) or, even better, an F1 driver (even less likely at this stage in life).
.tmb-editorspic.jpeg?sfvrsn=7981419_1)
