The 2014 Finance Bill - Tax avoidance

  • Tax treatment of derivative contracts between group companies (‘total return swaps’) and other schemes for the transfer of corporate profits.
  • Double tax relief: technical changes to prevent avoidance schemes.
  • Worldwide debt cap: changes to grouping rules and regulation making powers.
  • Controlled foreign companies (CFCs): changes to prevent profits from existing intra-group lending being diverted out of the UK tax net.
  • Transfer pricing: restriction of claims for compensating adjustments.
  • Further information requirements for ‘high-risk promoters’ of tax avoidance schemes.
  • Strengthening of DOTAS (Disclosure of Tax Avoidance Schemes) information powers.
  • Users of tax avoidance schemes that have been defeated in the courts in cases involving other taxpayers required to settle on that basis or risk a penalty if they cannot establish that the facts of their case are different.
  • Tax to be paid ‘upfront’ in the case of various tax avoidance schemes.
  • Anti-avoidance rules strengthened to counter schemes that seek relief for capital losses of companies against gains on derivatives and other financial products.