Worldwide interest cap: Difference between revisions

Latest revision as of 16:05, 21 February 2022

Tax - anti-avoidance.

A recommendation of the OECD's Base erosion and profit shifting (BEPS) initiative.

A worldwide interest cap limits corporate tax relief for interest and amounts economically equivalent to interest.

The UK implemented a restriction accordingly with effect from April 2017, under its Corporate Interest Restriction.

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-''Tax''.
+''Tax - anti-avoidance''.
-A proposal under the OECD's [[Base erosion and profit shifting]] (BEPS) initiative.
+A recommendation of the OECD's Base erosion and profit shifting (BEPS) initiative.
-The worldwide interest cap method is a proposed methodology to limit [[tax relief]] for interest and amounts economically equivalent to interest.
+A worldwide interest cap limits corporate tax relief for interest and amounts economically equivalent to interest.
-It would limit the total amounts eligible for relief to a cap equal to the total of a taxpayer group's net third party interest expense.
+The UK implemented a restriction accordingly with effect from April 2017, under its Corporate Interest Restriction.
-The total cap would then be allocated by territory through an appropriate allocation key, for example territory profits as a proportion of total group profits.
-An alternative proposed methodology is a fixed-ratio method.
 ==See also==
+* [[Base erosion and profit shifting]]
-* [[Common Consolidated Corporate Tax Base]]
+* [[Business in Europe: Framework for Income Taxation]]
-* [[Corporation Tax]]
+* [[CbC reporting]]
-* [[Diverted profits tax]]
+* [[Corporate Interest Restriction]]
-* [[Fixed-ratio method]]
+* [[Fixed ratio method]]
 * [[Tax avoidance]]
+* [[Tax relief]]
 * [[Transfer pricing]]
-* [[Double taxation]]
+[[Category:Accounting,_tax_and_regulation]]