Tax First: June 2012

You'll recall that we brought you an overview of the proposed financial transaction tax (FTT) in our February edition of Tax First. In this June edition we look at the decision by The European Union (EU) Parliament's Plenary to adopt the European Commission's plans for the FTT. We assess the impact of this decision and outline the important dates for the next part of the FTT process.

http://www.pwc.co.uk/tax/publications/tax-first-june-2012.jhtml

With the future of the eurozone still uncertain, we give you an overview of the potential impact of a break-up of the euro. We highlight some of the potential outcomes of a break-up for your business and link to our recent webcast with John Hawksworth, Chief UK Economist at PwC, where he outlines the four main predicted outcomes. If your clients trade in Europe, now is the time to be looking at their business? contingency plans.

A fundamental part of the controlled foreign companies (CFC) reforms introduced in Finance Bill 2012 dealt with group financing profits on eligible lending - for example, group loans made by the CFC to non-UK subsidiaries. The ability to finance a group's overseas operations without having to pay significant UK tax on the income is certainly a beneficial option.

MJP Services Ltd has appealed to the Court of Appeal following the Upper Tribunal's (UT) decision in respect of a partial waiver of a loan relationship. The UT's decision has implications for foreign exchange tax matching and transactions in general. We summarise the reasons behind the UT's decision and look at the possible impact for your client's business.

The next stage consultation document on the introduction of a UK general anti-abuse rule (GAAR) has been published. It includes draft legislation and gives a much clearer view of how such a rule might work. In this edition's governance section, we also give you a further brief update on amendments to the senior accounting officer rules.

Finally for this June edition, we look at two new consultations from HM Revenue & Customs - one relating to VAT invoicing and the other to VAT and non-EU freight transport.

You can keep up-to-date with the latest business issues on our iPhone/iPad app and on our brand new app for Android users. You can also follow us on Twitter (@PwC_North).

Best wishes

Brian Clark, North West Tax leader
Tel: +44 (0)161 245 2298