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UK announces Draft Finance Bill 2014
The Draft Finance Bill 2014 was released yesterday with a number of changes to tax legislation. Taxand UK highlights the key measures for businesses to recognise.
Given the deluge of anti-avoidance measures in recent years, it is difficult to see where else the Tax Authorities may focus. However partnerships have been targeted this year with a detailed campaign that is seeking to raise significant amounts of tax – perhaps a sign that the “Poachers” have pushed too far on the “Game Keepers.”
The tax authorities also seem to have been inspired by none other than Saint Nick, with a commitment announced to publishing “naughty lists” for:
- Banks that do not adopt the tax code of conduct requesting them to follow the spirit of tax legislation
- Promoters of aggressive tax avoidance schemes
Further to note, there has been an increase in the bank levy on chargeable equity and chargeable liabilities to sustain the commitment to a 20% rate of corporation tax and the usual verbiage about tax simplification.
The oil and gas industry is an unlikely beneficiary of Draft Finance Bill 2014, with a handful of measures designed to promote early investment in shale gas and to extend certain reliefs and exemptions.
Businesses that operate with a controlled foreign company should also take note of the changes to “switch off” partial exemption rules for interest receipts arising where the “main purpose” is to transfer profits out of the UK.
Also published in Thomson Reuters' Taxnet Pro, 13 December 2013
Some of the Draft Finance Bill proposals were announced on 5 December and the rest were issued yesterday, 11 December 2013. While the majority of updated tax measures are as expected, there are some concerns regarding the current wording of the Finance Bill anti-avoidance proposals which will catch certain commercial transactions that are not tax motivated.