Fund structuring – Impact of BEPS
One of the most important decision-making factors that an asset manager (General Partner – GP) considers in setting up a fund is to ensure that the investment structure is tax neutral for its investor (Limiter Partners – LPs) and provides for the most reliable regulatory framework. The complexity of setting up international investment vehicles pooling
Allocation of acquisition debt: economic rationale is key!
In today’s tax world, having a strong economic rationale to support an entity’s leverage is key. In our recent experience, the tax authorities look at a company’s gearing in 3 ways: Business purpose test: what is the motivation for each entity taking a loan? TP principles: Is the interest rate at arm’s length considering the
Impact of BEPS on M&A – Why should we care?
The OECD’s Base Erosion and Profit Shifting project (BEPS) project is the answer of the G20 to the current public debate around the use of privileged regimes. It is meant to define rules for a fairer and more equitable system of corporate income taxation. From an M&A perspective, it adds a layer of complexity and
OECD is heading toward consensus on interest limitation rules
The OECD and country representatives of the OECD Working Party 11 (‘WP11’) are likely to recommend in the BEPS action plan that local interest limitation rules should focus primarily on an interest/EBITDA cap, whereby countries may set the cap within certain boundaries (30% and 10% likely to be put forward as upper and lower limits). As
OECD Public Consultation on BEPS Actions 8 through 10 reveals planned revisions to transfer pricing drafts
During the July 6-7, 2015 public consultation on BEPS Actions 8 through 10, the OECD Working Party 6 announced planned revisions to its proposed changes to the Transfer Pricing Guidelines, including its December 2015 papers on Risk, Recharacterisation and Special Measures and Use of Profit Split Methods and its 2014 draft on Intangibles. The OECD
OECD releases model documents for implementing BEPS country-by-country reporting
On 8 June 2015, the OECD released a “Country-by-Country Reporting Implementation Package”. The package includes model legislation the OECD suggests could be used by countries to mandate filing of country-by-country reports (“CbCRs”). The model legislation does not attempt to address the filing of the so-called master file or local file reports. The key takeaway is
OECD Discussion Draft on transfer pricing aspects of hard-to-value intangibles published
The OECD has published a discussion draft on the arm’s length pricing of intangibles when valuation is highly uncertain at the time of the transaction or the intangibles are hard to value. The discussion draft, released on 4 June 2015, is part of Action Item 8 of the OECD’s Base Erosion and Profit Shifting (BEPS)
Revised OECD Discussion Draft on Treaty Abuse published
On Friday, 22 May 2015, the OECD issued a Revised Discussion Draft on BEPS Action 6: Prevention of Treaty Abuse (the RDD). The RDD includes a simplified Limitation on Benefits (LOB) Article for inclusion in the OECD Model Income Tax Convention and provides ‘conclusions and proposals’ on 20 targeted issues. Most of the proposals are
