09 décembre 2007

UK nouvelles fiscales

1d60b1255a966d61bc3127f2af0fb4dc.jpgII Protests over plan to block UK tax loophole

I Wealthy foreigners set to quit UK over tax
By Vanessa Houlder  Published: December 6 2007 21:33 | Last updated: December 6 2007 21:33

Some 3,000 wealthy foreigners will leave Britain as a result of the planned clampdown on their beneficial tax regime, the UK Treasury has admitted.

I Wealthy foreigners set to quit UK over tax
By Vanessa Houlder  Published: December 6 2007 21:33 | Last updated: December 6 2007 21:33

Some 3,000 wealthy foreigners will leave Britain as a result of the planned clampdown on their beneficial tax regime, the UK Treasury has admitted.

Under plans announced in October, foreign citizens based in the UK who are exempt from tax on their offshore income, the so-called “non doms”, will face an annual charge of £30,000 (€41,600) once they have lived in Britain for at least seven years. The Treasury also intends to close the loophole under which they can escape capital gains tax.

The plan, which is due to come into effect next April, is politically popular but has faced criticism that it will damage London as a financial centre and would persuade some of the super-rich to leave. The Chartered Institute of Taxation has said that the proposed capital gains tax changes would have “a profound impact on the housing and art markets in London as well as its pre-eminence as a financial centre”.

The Society of Trust and Estate Practitioners, which represents tax advisers, said its members have reported dozens of foreign clients deciding to leave the UK . In a consultation paper published on Thursday, the Treasury acknowledged that up to 3,000 people could leave over the long term. But it denied this would damage the financial services industry, where most international staff would leave before the seven-year grace period elapsed.

It calculated that about 4,000 people would pay the £30,000 fee that would allow them to keep overseas gains and income out of the UK tax net. But it said it had struck “the right balance bet-ween competitiveness and fairness”. The Treasury also predicted about 17,000 non-residents would be brought into the British tax net as a result of tougher rules for calculating days spent in the UK . It said weekly commuters who arrive in London on Tuesday and depart on Thursday would be deemed a UK resident.

Copyright The Financial Times Limited 2007

Protests over plan to block UK tax loophole
By Vanessa Houlder Published: December 6 2007 18:24 | Last updated: December 6 2007 18:24

Many entrepreneurs face higher tax bills and more red tape under Treasury proposals designed to stop a widely used form of tax planning by family-owned businesses.

The draft rules – published on Thursday and expected to raise £200m a year – sparked protests from professional groups that they would heap extra pressure on to small businesses already facing higher corporation and capital gains taxes.

The Institute of Directors said the draft legislation was “dreadful” and “wholly impractical”, although it aimed to address a legitimate concern. The Chartered Institute of Taxation said it had “grave concerns” about its implications.

The Professional Contractors Group, which represents freelances, said the new rules were deeply unfair and would be a nightmare to operate. “This measure will impose an horrific burden on hundreds of thousands of small family businesses, which will make it impossible to self-assess tax bills with any certainty.”

The new rules aim to stop high-earning individuals from diverting income, often as dividends, to another member of their family able to pay tax at a lower rate.

The Treasury said it was trying to combat the increasing opportunities for income-shifting that stem from the growth in small businesses taking a corporate structure. The Treasury has put forward the new rules in response to its legal defeat in the House of Lords this summer in a case involving Arctic Systems, an IT company. It failed in its attempt to use existing legislation to prevent income-shifting between the husband and wife who ran the business.

The new rules will stop individuals saving tax by shifting income to another family member, unless they can show they have structured their business on a commercial basis. Tax advisers said family businesses faced significant administrative hassle and uncertainty in establishing whether the rewards of the business were being paid out fairly.

The consultation paper said no additional records would be needed because “in the vast majority of cases” it should be clear from existing business records and documents whether the new legislation applied. But it acknowledged that the Revenue might want to see contracts of employment, time sheets, board minutes and research on market rates of pay to justify the way that income was split.

Francesca Lagerberg of Grant Thornton said she suspected the new rules would raise little extra revenue for the government, but they would cause extra worry and red tape for businesses. “Many entrepreneurs will now develop a persecution complex as the tax rules change yet again for them.”

The Professional Contractors Group said the new legislation was unfair because a married couple who jointly owned a business would have to split its value equally in a divorce, yet while they were married, they were not entitled to share the profits.

Andrew Hubbard of Tenon said: “The draft provisions seem to be a sticking-plaster solution where what is needed is a fundamental review of the whole structure of small business taxation.”

Copyright The Financial Times Limited 2007

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