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Moore Stephens says offshore maritime sector could be hit by new UK tax charge


Published Jan 23, 2015
Bill Susan - Moore Stephens
Bill Susan - Moore Stephens

International accountant and shipping adviser Moore Stephens says companies in the offshore maritime sector could be among those hit by a 25 percent Diverted Profits Tax (DPT) charge under draft UK legislation scheduled to enter force in April 2015.

Under the draft legislation published by the UK government in December 2014, the new DPT could potentially apply to many UK companies transacting with overseas connected parties.

Moore Stephens tax partner Sue Bill says, “The legislation as currently drafted is very wide-ranging and can apply wherever a UK company has entered into arrangements with connected parties involving enterprises or transactions with ‘insufficient economic substance’.

For example, this could apply where a UK company leases equipment from an overseas-connected company located in a low-tax jurisdiction, where the lessor’s staff do not carry on any significant activities and where it is reasonable to assume that the transaction or transactions were defined to secure a reduction in the UK company’s corporation tax liability.

Tags: Moore Stephens




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