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2010 articles

You will find listed here articles related to Asset Management in 2010.

Authorised Investment Funds (AIFs)

HMRC has announced measures to put an end to a corporation tax avoidance scheme involving UK corporate investors in AIFs such as open-ended investment companies and authorised unit trusts.

A first step towards pension freedom? Interim measure deferring the requirement to buy an annuity to age 77.

The Government has announced that it will end the effective requirement for members of registered pension schemes to purchase an annuity by age 75 with effect from 6 April 2011.

The FII Group Litigation Order – Where are we now on portfolio investments?

This article considers what scope is left for institutional portfolio investors such as investment funds and life insurance companies to reclaim UK corporation tax on overseas dividends paid to them before 1 July 2009 following February’s Court of Appeal decision in the case of Test Claimants in the FII Group Litigation v Revenue and Customs Commissioners. The case was brought about by UK parents of international groups, but the various stages of the case also impact on portfolio dividends.

Unauthorised Unit Trusts (“UUTs”)

HMRC has announced new measures to put an end to a corporation tax avoidance scheme involving UUTs. The scheme operated where a UUT received foreign income net of withholding tax and subsequently claimed a credit and resulting repayment of tax from HMRC where no tax had been or would be paid by the UUT.

Stamp Duty Reserve Tax: exemption for certain investments in Collective Investment Schemes

HMRC has stated that they intend to exempt certain investments made by Collective Investment Schemes from Schedule 19 Stamp Duty Reserve Tax (“SDRT”) charges.

Funds Investing in Non-Reporting Offshore Funds (“FINROFs”)

Following a consultation process, HMRC has introduced a new tax regime allowing Alternative Investment Funds (“AIFs”) to invest more than 20% of their gross asset value in FINROFs. Once an AIF exceeds this 20% threshold it will be subject to the new tax regime for FINROFs. The new regime will cover, for instance, ‘funds of hedge funds’ or ‘private equity funds of funds’.

Investment Trust Companies – modernisation

HMRC has announced its intention to review the tax legislation for investment trust companies with a view to modernising the tax rules.

Contractual based investment funds

From 1 April 2010, an option introduced in the Finance Act 2009 for corporate investors in offshore contract based funds such as Luxemburg FCPs and Irish CCFs will become compulsory. Under the rule, companies can ignore gains realised on the underlying fund portfolios in their corporation tax returns. Instead they must treat their participations in those funds in the same way as shares in a company or an investment in a unit trust and calculate chargeable gains and losses arising on disposals of those participations.

Offshore funds

Since Budget 2009, the new offshore funds legislation has been put in place and there have been recent amendments to the new legislation to assist with the transition to the new regime. HMRC has indicated that it will keep the new regime under review and is expecting to make further minor changes to deal with identified issues.

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Howard Jones

Howard Jones

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+44 (0)20 7063 4297 or +44 (0) 7794 031 167

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Carine Beidas

Senior Manager, Financial Services Tax
+44 (0)20 7063 4311

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