What caught your eye in the Autumn Statement/Finance Bill?
For real estate, the 3% SDLT surcharge for buy to let was particularly eye-catching. Once again, another round of consultation with HMRC will be required to iron out the details of the rules and the exemptions and avoid collateral damage (e.g. for corporate entities and funds owning more than 15 residential properties).
The announced accelerated payment date for non-resident CGT for disposals of UK residential property is another significant change coming so soon after the introduction of the tax and makes a mockery of the consultation exercise where this point was carefully considered by HMRC.
All in all, businesses buying residential property in the UK are now faced with a fiendishly complicated set of overlapping rules. It is quite remarkable how complicated this sector has become in only a few years.
What trends have you noticed in the marketplace?
There are a number of trends around inversions, focus on risk (particularly around international tax structures) and BEPS.
On the day to day transaction side, warranty and indemnity insurance of SPAs and tax deeds has rather quickly become a feature of many M&A deals. There are a number of issues associated with these policies particularly around risk allocation, coverage and disclosure which need to be worked through, but I see it is fundamentally altering the dynamic of risk protection under the traditional tax warranty/indemnity standard built-up over many years.
Insurers are also stepping in to cover identified tax risk where previously robust tax opinions were sufficient for clients: such insurance is not cheap and so the usefulness of such policies needs to be considered on a case by case basis.
If you could make one change to UK tax law or practice, what would it be?
It would be to have a reliable, properly resourced and responsive tax clearance system to get binding rulings from HMRC on any area of tax law. At the moment, there are pockets of excellence where you can get real help and engagement in a timely manner from HMRC, but equally there are no-go areas where it is impossible to get a clearance within a reasonable timeframe (if at all). It is understandable why, with scarce resources, this may not be a priority for HMRC, but the complexity and uncertainty in the tax code coupled with the unpredictability of HMRC and the courts imposes a frictional cost on clients and transactions which such a system would reduce or remove.
Aside from your immediate colleagues, whom in tax do you most admire?
Two mentors, Doug French (our former global head of tax) and Etienne Wong (our former head of VAT), who were great teachers as well as colleagues and seemingly effortlessly top of their game. Doug has gone on to become an executive coach, and Etienne is now at the Bar, so there is life outside Clifford Chance (who’d have thought it?).
Finally, you might not know this about me but …
I’ve been playing and collecting electric guitars for nearly 30 years.
What caught your eye in the Autumn Statement/Finance Bill?
For real estate, the 3% SDLT surcharge for buy to let was particularly eye-catching. Once again, another round of consultation with HMRC will be required to iron out the details of the rules and the exemptions and avoid collateral damage (e.g. for corporate entities and funds owning more than 15 residential properties).
The announced accelerated payment date for non-resident CGT for disposals of UK residential property is another significant change coming so soon after the introduction of the tax and makes a mockery of the consultation exercise where this point was carefully considered by HMRC.
All in all, businesses buying residential property in the UK are now faced with a fiendishly complicated set of overlapping rules. It is quite remarkable how complicated this sector has become in only a few years.
What trends have you noticed in the marketplace?
There are a number of trends around inversions, focus on risk (particularly around international tax structures) and BEPS.
On the day to day transaction side, warranty and indemnity insurance of SPAs and tax deeds has rather quickly become a feature of many M&A deals. There are a number of issues associated with these policies particularly around risk allocation, coverage and disclosure which need to be worked through, but I see it is fundamentally altering the dynamic of risk protection under the traditional tax warranty/indemnity standard built-up over many years.
Insurers are also stepping in to cover identified tax risk where previously robust tax opinions were sufficient for clients: such insurance is not cheap and so the usefulness of such policies needs to be considered on a case by case basis.
If you could make one change to UK tax law or practice, what would it be?
It would be to have a reliable, properly resourced and responsive tax clearance system to get binding rulings from HMRC on any area of tax law. At the moment, there are pockets of excellence where you can get real help and engagement in a timely manner from HMRC, but equally there are no-go areas where it is impossible to get a clearance within a reasonable timeframe (if at all). It is understandable why, with scarce resources, this may not be a priority for HMRC, but the complexity and uncertainty in the tax code coupled with the unpredictability of HMRC and the courts imposes a frictional cost on clients and transactions which such a system would reduce or remove.
Aside from your immediate colleagues, whom in tax do you most admire?
Two mentors, Doug French (our former global head of tax) and Etienne Wong (our former head of VAT), who were great teachers as well as colleagues and seemingly effortlessly top of their game. Doug has gone on to become an executive coach, and Etienne is now at the Bar, so there is life outside Clifford Chance (who’d have thought it?).
Finally, you might not know this about me but …
I’ve been playing and collecting electric guitars for nearly 30 years.
