Tax Law and International Tax Law

Recent UK Budget 2025 reforms have fundamentally altered the tax clearance regime for corporate restructurings, removing the explicit "bona fide commercial reasons" test and the 5% shareholder exemption while introducing new counteraction powers. These changes require businesses to provide more robust documentation of commercial objectives and prepare for heightened scrutiny from HMRC when seeking clearance for transactions including share exchanges, demergers, and company reconstructions.

The UK government has introduced draft legislation enabling defined benefit pension schemes to release surplus funds directly to members from April 2027, while HMRC updates to VAT guidance create uncertainty around input tax recovery for scheme administration costs. Meanwhile, new inheritance tax information-sharing requirements take effect, and the Pensions Regulator sets out its five-year strategic priorities focused on innovation, value for money, and supporting UK economic growth.

The UK commercial real estate market presents significant opportunities for overseas investors, but successful acquisitions require careful navigation of legal structures, tax implications...

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.

The European Commission has adopted a tax simplification package that abolishes withholding taxes on cross-border payments and modernises key direct tax directives. For private capital managers, the most significant development may be the formal withdrawal of the controversial Unshell Directive, though substance requirements remain on the regulatory agenda in a different form.

The UK commercial real estate market presents significant opportunities for overseas investors, but successful acquisitions require careful navigation of legal structures, tax implications...

The UK government has finalised inheritance tax information-sharing requirements for pension schemes, updated its pensions reform roadmap with key implementation dates through 2030...

The most significant development this quarter is arguably the Government's updated roadmap, which provides a fresh indication of when the various reforms under the Pension Schemes Act 2026 and beyond are likely to take effect.

Recent UK Budget 2025 reforms have fundamentally altered the tax clearance regime for corporate restructurings, removing the explicit "bona fide commercial reasons" test and the 5% shareholder exemption while introducing new counteraction powers. These changes require businesses to provide more robust documentation of commercial objectives and prepare for heightened scrutiny from HMRC when seeking clearance for transactions including share exchanges, demergers, and company reconstructions.

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The UK government plans to fundamentally reshape how British companies are taxed on their overseas operations by making the foreign permanent establishment exemption mandatory from 2027, with oil and gas companies facing an accelerated implementation timeline. This policy shift eliminates the current flexibility that allows UK businesses to offset foreign branch losses against domestic profits, raising critical questions about international competitiveness and investment strategy.