Tax and the City Review for March 2020

Budget 2020 announcements of interest to financial services include a new economic crime levy and a change to bank surcharge. A review is underway of the taxation of UK investment funds and a consultation on the hybrid mismatch rules is expected shortly. HMRC loses for the third time in Smith & Nephew as the Court of Appeal holds that the exchange losses were losses for the purposes of the loan relationships rules and dismissed HMRC’s latest argument that the losses did not represent ‘real world’ losses. The OECD’s much-anticipated Transfer Pricing Guidance on Financial Transactions was published in February and is an improvement on the 2018 discussion draft.

This article was first published in the 20 March 2020 edition of Tax Journal.