UK Tax Update Ð New Legislation on Corporate Taxation of Foreign Profits

In December’s Pre-Budget Report, the United Kingdom Government announced a package of measures following its review of the corporate taxation of foreign profits; this was followed by the release of draft legislation which is expected to become effective in spring 2009.

HM Revenue & Customs has indicated that much of the draft legislation is a work in progress and has been released for discussion. The possibility to see the legislation at an early date has been generally welcomed. However, in analyzing the detail of the draft legislation, it appears that certain aspects could have a significant impact on international businesses operating in the UK and concerns have been raised about the policy behind some of the proposals.