Consultation outcome

Modernising the taxation of corporate debt and derivative contracts

This consultation has concluded

Download the full outcome

Modernising the taxation of corporate debt and derivative contracts: consultation response

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Detail of outcome

This document summarises the responses received to this consultation and sets out the changes the government will make as a result.

Legislation to give effect to the main changes arising from this consultation is expected to be included in Finance Bill 2015. For the changes to be made in Finance Bill 2014 (concerning partnerships and bond funds), draft clauses will be published for further consultation in January 2014.

The government has carefully considered the responses made to the consultation document. The suggestions, concerns and criticisms received during the consultation process will be fully taken into account in the continuing development of policy and drafting of legislation. The government will continue to engage with stakeholders over the coming months to inform that process and further written consultation documents will be issued if appropriate.

Update on consultation

The Government has published a Technical Note providing an update on the progress of this project and setting out priorities for measures to be included in Finance Bill 2015.

Modernising the taxation of corporate debt and derivative contracts: Technical Note

Original consultation

Summary

This consultation is about modernising the rules governing the taxation of corporate debt (loan relationships) and derivative contracts.

This consultation ran from
to

Consultation description

At Budget 2013, the Government announced a review of the rules governing the taxation of corporate debt (loan relationships) and derivative contracts with the aim of redesigning them to be simpler, clearer and more resistant to tax avoidance; this consultation forms part of that process.

The Government invites comment on the proposals made and on their commercial and fiscal impact on businesses.

Open meeting

As part of this consultation, and as announced in the consultation document, HM Revenue and Customs held an open meeting on 27 June 2013 to explain the consultation process and to assist stakeholders in engaging with it. The slides presented at the meeting can also be found below.

Working groups

Four working groups of representatives from businesses, business advisers and other stakeholders have been established as part of the wider consultation process to discuss options and proposals in more detail. Minutes from the working groups are being published online.

The working groups have the following remits, based on the chapters of the consultation document:

Working Group 1

  • Chapter 3 - The Framework
  • Chapter 4 - Looking behind the accounts
  • Chapter 6 - A unified regime for loan relationships and derivative contracts
  • Chapter 14 - Anti-Avoidance measures

Working Group 2

  • Chapter 7 - Connected part debt
  • Chapter 8 - Intra-group transfers
  • Chapter 9 - Partnerships and transparent entities
  • Chapter 11 - Debt restructuring

Working Group 3

  • Chapter 5 - Accounting issues
  • Chapter 10 - Exchange gains and losses and hedging
  • Chapter 12 - Hybrids and special treatment instruments

Working Group 4

  • Chapter 13 - Bond funds and “corporate streaming”

Documents

Modernising the taxation of corporate debt and derivative contracts

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Slides from Loan Relationships open meeting

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Published 6 June 2013
Last updated 10 April 2014 + show all updates
  1. Updated to include a link to "modernising the taxation of corporate debt and derivative contracts: Technical Note"
  2. Added Modernising the taxation of corporate debt and derivative contracts Summary of Responses December 2013
  3. Updated to include information on Working groups
  4. Updated to include slides from the loan relationships open meeting
  5. First published.