EBITDA Interest Limitation Rule: New Circular Letter avoids unintended consequences when obtaining payment holidays
On 5 May 2020, the Belgian tax administration published its Circular Letter 2020/C/62 on specific payment holidays negotiated in the context of the COVID-19 crisis. More in particular, this circular accepts that certain loans will not lose their “grandfathered” status in case specific modifications are negotiated to loan agreements so to bridge temporary payment difficulties.
On 31 January 2019, the Chamber approved the advancement of the implementation date of the new interest limitation rule (30% EBITDA rule). The law will become effective after it is signed by the King and published in the Official Gazette. Concretely, this means that the Belgian 30% EBITDA rule will enter into force retroactively as from
On 28 July the OECD released a discussion draft relating to deductions for interest in the banking and insurance sectors. This is part of the ongoing work for BEPS Action 4, Limiting Base Erosion Involving Interest Deductions and Other Financial Payments, which was released as a final report in October 2015. The discussion draft does
On 20 June 2016, the Economic and Financial Affairs (ECOFIN) Council agreed on the Anti-Tax Avoidance Directive (ATAD) proposal of the European Commission, following approval of the Dutch presidency’s final proposal by the Belgian government and no further comments from other Member States. On 8 June 2016, the European Parliament (EP) approved 91 amendments to
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