Finance Act 2012 introduced new UK Controlled Foreign Company (CFC) rules with the aim of improving the competitiveness of the UK for business. The rules will come into force for accounting periods, of the CFC, commencing on or after the 1 January 2013.
The rules include a new Finance Company Regime, which provides for either a full exemption in certain circumstances or a partial exemption (with an effective tax rate in the UK of 5.5% by 2014) on certain overseas financing income which should significantly reduce a group’s cash tax payments and effective tax rate in the statutory accounts.
KPMG can help groups assess their current financing arrangements and review and advise on the opportunities available for establishing an overseas finance company within the group to maximise the benefits available from these proposals.
