HMRC releases draft changes to offshore tax rules

Revenue & Customs
(HMRC) on Friday released partial draft regulations on
changes to offshore funds regulations for comment, and to reveal the intended
use of the powers in clauses 38 and 39 of the Finance Bill 2008.

The partial draft regulations are aimed to action the policy set out in the
discussion paper released last October on modernising the offshore funds tax

HMRC is seeking comments on the proposed regulations, particularly on whether
the draft regulations achieve the policy intentions detailed in Trerasury’s
publications, reports.

Before the introduction of the UK tax regime for offshore funds in 1984, a UK
investor could accumulate income in an offshore fund, and, when the investment
was realised, only pay tax on capital gains rather than income.

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