On February 21, 2017 the UK Government published draft legislation and an explanatory memorandum regarding the Corporate Interest Restriction Regulations 2017 (Consequential Amendments). The draft legislation contains proposed provisions for collective investment vehicles and securitisation companies under the Corporate Interest Restriction (CIR) Rules. The Regulations intend to ensure the rules relating to collective investment vehicles and securitisation companies continue to operate as intended under the CIR rules.

The consultation period will close on April 18, 2017.

These amending Regulations provide for consequential amendments as a result of the new Corporate Interest Restriction (CIR) rules introduced in Finance Act 2017.

 

In particular, they make amendments to:

·   the Authorised Investment Funds (Tax) Regulations 2006;

·   the Taxation of Securitisation Companies Regulations 2006;

·   the Taxation of Insurance Securitisation Companies Regulations 2007;

·   the Investment Trusts (Dividends) (Optional Treatment as Interest Distributions) Regulations 2009.

 

The amending Regulations make provision for collective investment vehicles and securitisation companies to ensure the operation of the CIR rules does not give an unintended result in these entities.

 

According to the draft legislation:

·   The Regulations have effect for accounting periods beginning on or after April 1, 2017.

·   An accounting period beginning before and ending after April 1, 2017 is to be treated for the purposes of these Regulations as if so much of the accounting period as falls before that date, and so much of the period as falls on or after that date, were separate accounting periods.

·   Where it is necessary to apportion an amount to the two separate accounting periods, it is to be apportioned on a just and reasonable basis.

 

Click here to be forwarded to the draft legislation as released by the UK Government on February 21, 2017.

 

Click here to be forwarded to the accompanying Explanatory Memorandum.

 


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