Legal News

Draft Finance Bill 2017—new corporate interest restriction provisions

Published on: 24 November 2020
Published by: LexisNexis
  • Draft Finance Bill 2017—new corporate interest restriction provisions
  • Original news
  • What provisions have now been released?
  • What are the most interesting points arising out of the new drafting? Are the new provisions broadly in line with what we were expecting?
  • We now have the key definitions that feed into the 'group ratio' method for restricting interest—how will the group ratio be calculated?
  • An optional 'alternative calculation' election has now been included for groups who want to apply the group ratio method. Further elections have also been introduced concerning joint ventures and partnerships—do you see these being taken up by groups? What is the rationale for having these?
  • We now have the drafting for the public benefit infrastructure exemption and provisions dealing with particular industry areas, such as oil and gas, leasing, insurance and REITs—what are the key points to note here?
  • Have any substantive changes been made to the provisions that were published in December 2016?
  • It is still intended for the new corporate interest restriction provisions to enter into force on 1 April 2017—how do you see the introduction of these rules working in practice, and what will be the biggest challenges?

Article summary

Tax analysis: What are the latest corporate interest restriction provisions that have been included in draft Finance Bill 2017? Andrew Loan, of counsel at Fieldfisher LLP, says the new provisions are broadly in line with expectations, but with 133 pages of fine-grained new legislation to pore over, and new and unfamiliar definitions and concepts, the devil will be in the detail. or take a trial to read the full analysis.

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