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Re: Brexit Development(s) Discussion
And the reason for these changes...
https://www.theneweuropean.co.uk/top...f-eu-1-5669763
Quote:
The directive seeks to tackle the thriving culture of corporate tax avoidance. For example, consider the scenario in which an EU company shifts profits to a related company in a low-tax country reducing the tax paid on these profits: under ATAD, a company could still do this, but the profits will be taxable at EU rates.
Another situation is where EU businesses developing a new product move it to a low tax country to avoid paying larger taxes on the profits once it is developed. Thanks to ATAD this tactic won’t work as member states can levy tax on the product before it is moved.
Even with ATAD, you might argue companies – through their nifty lawyers – will find new loopholes to avoid tax, right? The EU thought of that: ATAD provides a general anti-abuse rule to counteract these regimes where national laws have failed to address them.
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I asked my friend* (who is a Tax Partner with one of the "Big 4" about these changes, and he thinks they are a good idea, and will discourage the behaviours listed above.
*we are also god-parents to each others children, and go on holiday together (next year is a Florida road trip...
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