City regulator, the Financial Services Authority, had been scheduled to approve the new funds in March meaning investment could take place from the beginning of the next tax year.
The FSA thought it had the support of the Revenue, which is under pressure to stop treating hedge funds as trading income.
This means they are taxed on a yearly basis and a second time when paid to investors.
However, the Revenue said it had had only ‘preliminary and informal’ contacts with the FSA and that no decision had been taken to go ahead with tax changes.
City insiders fear that unless the Revenue comes to a decision soon, the UK could lose its pre-eminent position in the European hedge fund sector.
Making Tax Digital will impose significant additional tax compliance costs on small businesses for little or no medium term benefit, tax and small business experts told MPs
The drive towards a fully digital tax regime is an admirable one, but mandation is simply wrong, according to one of the UK's most senior tax technology practitioners - Paul Aplin
HMRC has won its tenth successive case against tax avoidance schemes promoted by NT Advisors. The Court of Appeal has ruled that NT ... read more
HMRC is continuing to ramp up the number of raids on premises it carries out as part of criminal investigations, searching 761 properties in the last year