Fixed-ratio method: Difference between revisions

Revision as of 06:48, 2 May 2018

Tax - anti-avoidance.

The fixed ratio method is a mechanism to limit corporate tax relief for interest and amounts economically equivalent to interest.

It limits the amounts eligible for relief to a percentage of a taxpayer's profits.

Under the UK's Corporate Interest Restriction, with effect from April 2017:

@@ Line 1: / Line 1: @@
-''Tax''.
+''Tax - anti-avoidance''.
-A proposal under the OECD's [[Base erosion and profit shifting]] (BEPS) initiative.
+The fixed ratio method is a mechanism to limit corporate tax relief for interest and amounts economically equivalent to interest.
-The fixed-ratio method is a proposed methodology to limit [[tax relief]] for interest and amounts economically equivalent to interest.
+It limits the amounts eligible for relief to a percentage of a taxpayer's profits.
-It would limit the amounts eligible for relief to a percentage of a taxpayer's profits.
+Under the UK's Corporate Interest Restriction, with effect from April 2017:
-An alternative proposed methodology is a worldwide interest cap.
+*The fixed ratio for a large worldwide group is 30%
+*The measure of profits the group's aggregate tax-EBITDA
 ==See also==
 * [[Common Consolidated Corporate Tax Base]]
+* [[Corporate Interest Restriction]]
 * [[Corporation Tax]]
-* [[Diverted profits tax]]
+* [[Debt cap]]
+* [[EBITDA]]
+* [[Group]]
+* [[Tax avoidance]]
 * [[Worldwide interest cap]]
-* [[Tax avoidance]]
-* [[Transfer pricing]]
-* [[Double taxation]]