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An analysis from Travers Smith, Taxand UK
The UK tax authority (HMRC) has recently expanded the exclusions to its new Mandatory Tax Adviser Registration regime, providing welcome clarity for businesses with in-house tax functions. The updated guidance confirms that registration is generally not required where there is no genuine third-party commercial advisory relationship, addressing concerns that the original rules could have captured routine support provided by internal tax teams.
The changes are particularly significant for private capital managers. HMRC has indicated that tax advice provided by fund managers, investment advisers and in-house tax teams to fund entities, portfolio companies and investors will often fall within the expanded exclusions. This offers greater certainty for organisations that had been concerned the narrow “group undertaking” exemption would not reflect the realities of complex investment structures.
While the Mandatory Tax Adviser Registration regime remains on track for introduction, HMRC has confirmed that businesses acting in good faith can rely on the guidance when determining whether registration is required. The UK government also intends to legislate for statutory exemptions that align with the new guidance, reducing the compliance burden for many in-house tax teams and private capital businesses.
Tom Margesson and Ian Zeider from our UK member firm, Travers Smith, provide a comprehensive analysis of the new regime, including further details on the issue for in-house teams, the pause in implementation for regulated businesses and the status of the guidance, which you can read here.
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