United Kingdom: Tax

Tax Counsel Elizabeth Spencer shares insights from her career in tax law, discussing her diverse practice spanning transactions, advisory work, and contentious matters at McDermott Will & Emery. She reflects on the evolving nature of tax legislation and offers perspective on building expertise in this dynamic field.

HMRC has launched a consultation on simplifying treaty relief from withholding tax on interest payments made overseas, addressing longstanding administrative challenges in the current system. The consultation explores potential reforms including a self-assessment approach that would eliminate the need for prior HMRC direction, fundamentally changing how UK borrowers and overseas lenders navigate cross-border financing arrangements.

HMRC has issued new compliance guidelines for employers managing short-term business visitors to the UK, clarifying common misconceptions about tax liabilities and treaty obligations. The guidance highlights critical errors employers make when handling international mobility, from miscounting UK days to misunderstanding double-taxation treaties.

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Understanding the complexities of inheritance tax on trusts can be challenging for practitioners navigating Scottish private client law. This practical guide demystifies the 10-year anniversary charge, providing essential insights into calculation methods, exemptions, and strategic planning considerations that trustees and advisors need to master.

The Scottish Government recently published its review of wealth taxation in Scotland. The report does not recommend introducing a wealth tax, but it does consider whether one could operate effectively within Scotland's fiscal and constitutional framework.

The First-tier Tribunal examined whether HMRC could retrospectively impose late payment penalties and surcharges after reallocating tax payments made by a taxpayer who had entered into unsuccessful tax avoidance schemes. The case centered on the critical question of whether tax liability should be assessed at a specific point in time or whether subsequent payment reallocations could create retroactive late payment scenarios.

Branded residences combine luxury property ownership with hotel-quality amenities and international brand recognition, but they also introduce complex UK tax implications that investors must carefully navigate. From capital gains tax and inheritance tax exposure to the nuances of the Statutory Residence Test, acquiring a UK branded residence can significantly impact an investor's tax status and that of their family members. Understanding these considerations is essential before making what may appear to be

Hosting overseas employees in the UK creates complex tax, payroll and immigration obligations that extend far beyond contractual arrangements. What practical risks emerge when international working becomes routine, and how can employers ensure compliance when form doesn't override substance?

When HMRC issued an information notice demanding a UK subsidiary's US parent company financial statements in a transfer pricing enquiry, the First-tier Tribunal had to determine whether such documents were reasonably required and whether the subsidiary had the power to obtain them. The case examines the boundaries of HMRC's information-gathering powers and the practical limits of corporate group relationships.

The UK's new International Controlled Transactions Schedule (ICTS) will fundamentally transform how HMRC assesses transfer pricing risks, shifting from documentation-focused reviews to data-driven analysis powered by AI and advanced analytics. With mandatory filing beginning January 1, 2027, multinational enterprises must prepare to provide detailed, standardized information about cross-border related party transactions, facing unprecedented scrutiny and visibility of their transfer pricing arrangements.

The OECD's side-by-side package introduces new safe harbors for multinational groups under Pillar Two's global minimum tax regime, responding to U.S. concerns about undertaxed profits rules and existing tax credits. These reforms create significant implications for M&A transactions, particularly affecting due diligence processes, target pricing certainty, and contractual protections for deals involving U.S. acquirers and joint venture structures with mixed investor bases.