HMRC open consultation – Improving large business tax compliance

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At Summer Budget 2015, the UK government confirmed its intention to consult on measures intended to improve large business tax compliance.

HMRC’s ‘man-marking’ approach to large businesses has proven to be very successful. However, some large businesses have yet to adopt the best practice in tax compliance, while a small number persist with aggressive tax planning, and/or resist full and open engagement with HMRC. Read the rest of this entry »

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BEPS: Transfer Pricing – Status Update

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OECD Working Party 6, which deals with transfer pricing and intangibles, held its final public consultation on Actions 8-10 (transfer pricing) of the BEPS project on 6 and 7 July 2015.

The key messages from the update are as follows. Read the rest of this entry »

Advance Thin Capitalisation Agreements with HMRC

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(An article entitled “The HMRC ATCA Process” was published on this website on 12 February 2018, with an accompanying slide presentation on my YouTube channel.)

Transfer pricing should be a concern for all multinational enterprises (MNEs) operating in the UK.

The UK’s corporation tax self-assessment regime requires the taxpayer to ensure that their transfer pricing reflects ‘arm’s length’ prices on all related-party transactions, including UK-UK.

Interest and penalties may be imposed for non-compliance, even for businesses with losses, so there could be serious financial implications if a business does not take its transfer pricing obligations seriously. Read the rest of this entry »

UK Offshore tax evaders to face tough new criminal sanctions

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Tax avoidance and evasion has been much in the news recently, with focus on whether it is legal or morally correct and the impact it has upon the UK economy.

Both avoidance and evasion require an act or omission so that something which should happen (e.g. paying tax) does not happen. However, evasion also requires some deception or wrongdoing underlying the act or omission. Read the rest of this entry »

MNEs face £1.1 billion bill following HMRC Transfer Pricing challenges

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The UK rules covering Transfer Pricing between companies in the same multinational enterprise (MNE) are based on international standards set by the Organisation for Economic Co-Operation and Development (OECD)

Providing goods and services to companies in the same group is part of normal commercial practice. However, some MNEs try to manipulate the prices charged to reduce the tax they have to pay. Read the rest of this entry »