Dual resident investing companies (DRICs)
Produced in partnership with Robert Langston of Saffery Champness
Dual resident investing companies (DRICs)

The following Tax guidance note Produced in partnership with Robert Langston of Saffery Champness provides comprehensive and up to date legal information covering:

  • Dual resident investing companies (DRICs)
  • Base erosion and profit splitting (BEPS)
  • Double tax treaties
  • Anti-avoidance rules—group relief
  • Anti-avoidance rules—capital allowances
  • Anti-avoidance rules—capital gains
  • Anti-avoidance rules—trading losses
  • Anti-avoidance rules—hybrid rules
  • What is a DRIC?

Brexit: As of exit day (31 January 2020) the UK is no longer an EU Member State. However, in accordance with the Withdrawal Agreement, the UK has entered an implementation period, during which it continues to be subject to EU law. This includes interpreting legislation relating to the EU as though the EU still included the UK and has an impact on this Practice Note. For further guidance, see Practice Note: Brexit—UK tax consequences.

A company may be resident for tax purposes in two different countries—see Practice Note: When a company is UK tax resident—Can a company have multiple residencies for tax purposes?

Although there may be disadvantages, such a company could also take advantage of domestic tax reliefs in each of the jurisdictions in which it is considered resident.

For example, a company that is incorporated in the US but centrally managed and controlled in the UK will be resident in both the UK and the US (absent competent authority agreement under the UK/US double tax treaty, which is unlikely to be forthcoming). In the absence of rules to the contrary, this company could relieve its losses against the profits of both a UK group and a US group.

This Practice Note explains the key anti-avoidance rules applying in the UK to dual resident investing companies (DRICs), and also discusses what constitutes a