Articles
Treaty Shopping
Sometimes, companies are set up in jurisdictions merely to obtain the tax benefits that are granted under the relevant tax treaty, whilst the chosen structure in reality has little commercial substance. Tax authorities worldwide are aware of these so-called treaty shopping practices and have become more and more sophisticated in combating such misuse of tax treaties. In this article I will discuss some of the tools available to tax authorities in targeting treaty shopping. Being aware of these tools is essential when establishing the most appropriate and efficient tax structures for cross-border activities.
Notes re 2007 Pre-Budget Report (PBR)
I would like to hear from any staunch supporter of the Labour party what elements of the Chancellor’s pre-budget report are designed to make the tax system in the UK fairer to its residents, or designed to make the UK a more attractive jurisdiction in which to conduct business activities. If we look at the individual items that were covered by the PBR, we can identify the following:-
Finance Structures and the Indofood Case
The Indofood case has received significant attention within the tax profession.The case related to the interpretation of a loan note agreement between JP Morgan and the Indonesian based Indofood group. The Indonesian parent company issued a loan note to note holders via the use of a Mauritius finance SPV (M SPV). Under the loan agreement, any withholding tax on interest would be for the account of Indofood.
Taxation Book Review
The Principles of International Tax Planning
By International Fiscal Services Ltd
Published by Corpus Publishing Ltd, price £95
There has been little to date available to students and tax practitioners as material on the general principles of international taxation. It is therefore appropriate that the team from International Fiscal Services Ltd has come up with an excellent volume that provides the framework by setting out the general principles as well as applying these principles to practical situations.
The authors have adopted a refreshing approach in dealing with the vast and complex area of taxation….
The international tax aspects of intellectual property
Income from intellectual property rights may be derived by way of royalties. As with other sources of income, the tax planning of intellectual property should concentrate on maximising the after tax profits. To ensure that arrangements made to receive royalties are effectively constructed, it is neccessary to analyse how various countries treat the payment of royalties, whether tax is withheld on such payments and how the income receipts and expenditures are treated.
