Judy Harrison discusses the EC’s parent-subsidiary directive proposals and why they ‘may not require any significant changes’ to UK tax law
The European Commission has published proposals to amend the parent-subsidiary directive (Council Directive 2011/96/EU). The main changes are to permit member states to tax distributions which are paid under hybrid instruments (i.e. where the payer received a deduction) and to strengthen the anti-avoidance provisions in the directive.
What is proposed?
The directive was introduced to eliminate double taxation of companies operating in different EU countries. This is achieved by preventing member states from withholding tax on certain distributions of profits and by restricting the ability of member states to tax the recipient of a distribution.
It is proposed that the recipient of a distribution under a hybrid instrument may be taxed without any need to give credit for tax paid by the company paying the distribution. Hybrid...
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Home >Articles > EC parent-subsidiary directive proposals ‘may not require any significant changes’ in UK
EC parent-subsidiary directive proposals ‘may not require any significant changes’ in UK
Judy Harrison discusses the EC’s parent-subsidiary directive proposals and why they ‘may not require any significant changes’ to UK tax law
The European Commission has published proposals to amend the parent-subsidiary directive (Council Directive 2011/96/EU). The main changes are to permit member states to tax distributions which are paid under hybrid instruments (i.e. where the payer received a deduction) and to strengthen the anti-avoidance provisions in the directive.
What is proposed?
The directive was introduced to eliminate double taxation of companies operating in different EU countries. This is achieved by preventing member states from withholding tax on certain distributions of profits and by restricting the ability of member states to tax the recipient of a distribution.
It is proposed that the recipient of a distribution under a hybrid instrument may be taxed without any need to give credit for tax paid by the company paying the distribution. Hybrid...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
