PracticeAccounting FirmsBUDGET IN DEPTH: FOREX grumbles continue

BUDGET IN DEPTH: FOREX grumbles continue

Tax experts were yesterday dismayed that they did not receive further documents in the Budget clarifying forthcoming changes to the foreign exchange rules.

The Treasury intends repealing the foreign exchange rules and replacing them with the loans relationships legislation and its now notorious line 13.

Line 13 was intended to be used to define which foreign exchange transactions have been made for ‘unallowable purposes’, and a full definition was promised among the Budget press releases.

However, experts have complained the clarification did not appear and they remain as unhappy with the proposed changes as when the idea was first raised in 1996.

Derek Jenkins, a partner at PricewaterhouseCoopers, said: ‘We haven’t seen the document that was promised.’

The changes to foreign exchange legislation are intended to root out tax avoidance among companies moving large sums of foreign currency.

But line 13 has been widely criticised for being ‘untested’ and badly drafted, and equating ‘unallowable purposes’ with tax advantages and avoidance.

Experts say tax advantages cannot always be assumed to be avoidance.

Roger Muray, a tax partner with Ernst & Young, said: ‘There’s still a concern and the main concern is that it is so badly drafted.’

It remains to be seen when the Revenue will release the document clarification.

Related Articles

BDO’s global revenues pass $8bn

Accounting Firms BDO’s global revenues pass $8bn

4d Alia Shoaib, Reporter
Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

Accounting Firms Top 40 International Networks, Associations and Alliances: Finding growth amid uncertainty

6d Philip Smith, Reporter
Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

Accounting Firms Top 40 International Networks, Associations and Alliances 2017: Big Four tussle for top spot

1w Emma Smith, Managing Editor
BDO reports revenue growth of 5.7%

Accounting Firms BDO reports revenue growth of 5.7%

2w Alia Shoaib, Reporter
Taylorcocks announces merger with Surrey firm

Accounting Firms Taylorcocks announces merger with Surrey firm

2w Emma Smith, Managing Editor
Kingston Smith reports 7% gender pay gap

Accounting Firms Kingston Smith reports 7% gender pay gap

2w Emma Smith, Managing Editor
RSM announces two partner promotions

Accounting Firms RSM announces two partner promotions

3w Emma Smith, Managing Editor
Backsourcing: The latest accountancy trend?

Accounting Firms Backsourcing: The latest accountancy trend?

1m Pillsbury Winthrop Shaw Pittman