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Income shifting: consultation on draft legislation and guidance
Practical Law UK Legal Update 2-379-8532 (Approx. 6 pages)
Income shifting: consultation on draft legislation and guidance
by PLC Tax
| Published on 10 Dec 2007 • England, Wales |
On 6 December 2007, HM Treasury and HM Revenue & Customs (HMRC) published a joint
, which includes draft legislation and draft guidance, to implement the new income shifting rules promised in the 2007 Pre-Budget Report (see Legal update, 2007 Pre-Budget Report: Consultation on legislation to counter income shifting: HMRC's response to Arctic Systems)
following HMRC's defeat in the House of Lords in Jones v Garnett [2007] UKHL 35
.
The new legislation will take effect from 6 April 2008 and will apply to income received after that date even if the income relates to an earlier tax year.
The consultation period ends on 28 February 2008.
The new income shifting regime will have a significant impact on the 65,000 companies and 20,000 partnerships that HMRC estimates are engaging in income shifting.