A round up of other news this week.
On 5 December 2017 the Economic and Financial Affairs Council of the EU (ECOFIN) published their 2017 ‘blacklist’ of non-cooperative jurisdictions for tax purposes and confirmed that tax jurisdictions will remain on this list until they meet the required criteria. During the meeting, the ECOFIN also adopted conclusions on the taxation of profits of the digital economy, with the objective to outline a common EU position in discussions at the international level. KPMG’s EU Tax Centre has prepared a Euro Tax Flash giving further detail on these developments.
The OECD has released the first annual report on the exchange of information on tax rulings in accordance with BEPS Action 5, covering 44 countries. The OECD’s review covered more than 10,000 relevant rulings such as advance pricing agreements, permanent establishment rulings, related party conduit rulings and rulings on preferential regimes, and includes around 50 country-specific recommendations on various issues.
The OECD have published an interactive map showing the ongoing work on international tax cooperation around the world, including that on BEPS.
HMRC have published a new tranche of draft guidance on the corporate loss relief reforms, covering the commencement provisions and apportionment methods when an accounting period straddles the start date of the legislation (1 April 2017).
The First-tier Tribunal has held that a corporation tax late filing penalty was not valid as it was issued automatically by HMRC’s computer system instead of by an authorised officer of HMRC. The FTT also held that, regardless of this, the company had a reasonable excuse for not filing its company tax return on time.
The Corporate Interest Restriction (Financial Statements: Group Mismatches) Regulations 2017 have been published, making provision for adjustments to calculations where the accounts of the worldwide group and the accounts of a company in the group give rise to mismatches on the commencement of the new provisions.
The Collective Investment Schemes and Offshore Funds (Amendment of the Taxation of Chargeable Gains Act 1992) Regulations 2017 have been published and come into force on 1 January 2018. The regulations, which were published in draft in March 2017, amend legislation to clarify how an investor in a COACS or OTF who disposes of units in the fund should compute the chargeable gain. The definition of the ‘relevant date’ for certain types of adjustments to the chargeable gains base cost have been removed from the final legislation, likely as a consequence of the proposed changes to corporate indexation allowance announced at the Autumn Budget.
The Co-ownership Authorised Contractual Schemes (Tax) Regulations 2017 have been published, introducing new legal requirements on the operator of a CoACS to provide certain tax information to its investors and to HMRC. The instrument also introduces new legal requirements where a CoACS invests in offshore funds, that certain amounts must be treated as the income of its participants.
HMRC have published regulations amending the list of permitted property for personal portfolio bonds.
HMRC have published draft regulations to update the securitisation regime to reflect recent accounting changes and commercial developments, for example amending the definition of ‘financial assets’ to make it clear that loans with embedded derivatives are still to be excluded from the regime following changes to accounting standards. A draft explanatory memorandum and a tax information and impact note has also been published. The draft regulations are open for comment until 15 January 2018.
Ahead of the devolution of Landfill Tax to Wales in 2018, HMRC have published draft legislation for consultation and a tax information and impact note. The draft legislation will amend the Landfill Tax Regulations 1996 so Landfill Tax no longer applies and the Landfill Communities Fund (LCF) closes in Wales. From April 2018, Landfill Disposals Tax will apply in Wales.
HMRC have published a technical note on the Autumn Budget 2017 announcement that activities by petroleum licence holders (participators) which give rise to tariff income in relation to UK oil and gas assets will be brought within the oil and gas ring fence tax regime for accounting periods beginning on or after 1 January 2018.
HMRC have published the responses received to their consultation on simplifying the Gift Aid donor benefits rules and how the Government plans to proceed. Draft legislation will be published in 2018 for technical consultation followed by draft guidance on the application of the new rules.
KPMG Enterprise’s European Family Business Barometer 2017 reveals the ‘war for talent’ raging within family businesses.
Staying on the skills theme, KPMG’s Justin Zatouroff comments on the latest Markit PMI figures.