A second consultation document on the UK’s implementation of the OECD’s recommendations relating to corporate interest expense deductibility under base erosion and profit shifting (BEPS) Action 4 was published on 12 May 2016.
The UK government previously announced that new rules on interest deductibility will be introduced from April 2017 in line with the recommendations set out in the OECD report, and an initial consultation document was published in October 2015. The key policy design features for a restriction on the tax deductibility of corporate interest expense were included in the “Business Tax Roadmap” published alongside the UK budget 2016. This latest consultation seeks stakeholder input on the detailed design of the new rules to inform the drafting of the legislation for Finance Bill 2017.
The 92-page consultation document sets out further detail on the proposed design of the new rules together with 46 specific questions on which HM Treasury is seeking the views of stakeholders.
Read a May 2016 report prepared by the KPMG member firm in the UK: Consultation: Tax deductibility of corporate interest expense
The KPMG logo and name are trademarks of KPMG International. KPMG International is a Swiss cooperative that serves as a coordinating entity for a network of independent member firms. KPMG International provides no audit or other client services. Such services are provided solely by member firms in their respective geographic areas. KPMG International and its member firms are legally distinct and separate entities. They are not and nothing contained herein shall be construed to place these entities in the relationship of parents, subsidiaries, agents, partners, or joint venturers. No member firm has any authority (actual, apparent, implied or otherwise) to obligate or bind KPMG International or any member firm in any manner whatsoever. The information contained in herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. For more information, contact KPMG's Federal Tax Legislative and Regulatory Services Group at: + 1 202 533 4366, 1801 K Street NW, Washington, DC 20006.