UK holding companies and CFC reform

This article seeks to explain the exodus of UK companies from the UK in recent years and then to assess the response of the UK's Coalition Government, with particular reference to the UK as a location for holding companies and the proposed reform of the controlled foreign company (CFC) regime.

The article concludes it seems unlikely that the Government will in fact manage to make the UK’s corporate tax regime the most competitive in the G20, at least when measured in terms of effective tax rates rather than headline rates. But if the Government gets CFC reform right, the only clear defect in the system for a typical UK multinational will be a minor one, namely the continued imposition of stamp duty on share transfers.

This article appeared in the 2012 edition of The International Comparative Legal Guide to: Corporate Tax; published by Global Legal Group Ltd, London.

William Watson (partner)