‘Close’ companies which are not close investment-holding companies
The rules for interest relief will be changed to include companies that would be ‘close’ (controlled by five or fewer participators) which are not UK-resident but are resident in another EEA state (the EU plus Norway, Iceland and Liechtenstein).
The exclusion of close investment-holding companies confines the relief to trading companies and others with active businesses, including property companies.
At present relief is only available if the company is UK-resident. This is believed to contravene EU law but the Government has not announced any plans for retrospective change.
A similar extension applies to EEA-resident employee-controlled companies. These are not close companies because of the number of participators involved but must be trading.