HM Revenue & Customs (HMRC) on 6 February 2017 published guidance on the transfer pricing aspects of cash pooling arrangements. The guidance is provided for both taxpayers (and their advisors) and HMRC specialists and client relationship teams, and is structured to cover a full range of issues associated with cash pooling, from its most basic form to some of the more complex issues associated with a substantial cash pool header.
The guidance includes commentary on:
The guidance has been subject to a lengthy period of development within HMRC, and highlights an enhanced focus of HMRC on the transfer pricing implications of related-party financing transactions. In addition to the new guidance, tax professionals in the UK report having seen more ‘live’ enquiries from HMRC in relation to cash pooling arrangements and the role of group treasury entities.
Read a February 2017 report prepared by the KPMG member firm in the UK
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.