Substance | KPMG | QM

Substance, substance, substance

Substance

The substance of activities and value creation.

The substance of activities and value creation.

The crux of any new rules to be introduced in coming months and years will include a much greater focus on the substance of activities and value creation rather than where profits are being booked. For the finance industry, “substance” amounts to senior people making key decisions. In the context of contractual arrangements, emphasis will be on actual performance of the contract in question and the level of seniority of those undertaking the activities. 

Looking ahead, all aspects of international taxation will be heavily influenced by the outcome of the BEPS project. One key outcome of the process will be to increase disclosure and reporting obligations on international groups. This comes at a time when many global businesses are addressing their tax policy in the light of changing shareholder and customer attitudes.

 

 

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