Private equity funds

FORTHCOMING CHANGE relating to the tax treatment of carried interest: Following a call for evidence on the tax treatment of carried interest that ran over summer 2024, at Autumn Budget 2024 the government announced that it will introduce a revised tax regime for carried interest, from 6 April 2026, that will sit within the income tax framework, subject to special rules to take account of the unique characteristics of the reward. Draft legislation for the new tax regime for carried interest can be expected during 2025. In the meantime, the capital gains tax rates currently applicable to carried interest will be increased to 32% from 6 April 2025. Legislation for that measure will be included in the Autumn Finance Bill 2024. For more on the government announcement on carried interest tax reform, including some commentary from legal experts in the field, see our News Analysis: Autumn Budget 2024—Tax analysis—Private equity and venture capital, and also see News Analysis: Autumn Budget 2024—carried interest taxation reform.

The UK is regarded as one of the leading global asset management centres. Private equity funds, together with their

To view the latest version of this document and thousands of others like it, sign-in with LexisNexis or register for a free trial.

TAKE A FREE TRIAL

Latest Tax News

Autumn Budget 2024—Tackling tax non-compliance in the umbrella company market

Tax analysis: At the Autumn Budget 2024 on 30 October 2024, it was announced there would be changes regarding who is responsible for pay as you earn/National Insurance contributions (PAYE/NIC) when workers are paid through an umbrella company. Robert Woodward, tax associate director and John Chaplin, partner at BDO analyse the changes.

Tax weekly highlights—21 November 2024

This week's edition of Tax weekly highlights includes: (1) the Supreme Court decision in Refinitiv concerning the interaction between the diverted profits tax and an advance pricing agreement, and (2) the Supreme Court decision in Cobalt Data Centre on the scope of the enterprise zone allowance.

UT finds FTT made errors when setting aside HMRC best judgment assessment (HMRC v Sintra Global)

Tax analysis: In Sintra Global, the Upper Tribunal (UT) set aside the decision of the First-tier Tax Tribunal (FTT) insofar as it related to a notice HMRC had issued to an individual making him liable for the payment of a civil evasion penalty charged against a company he was a director of. The UT found that the FTT had failed to follow the guidance provided by the Court of Appeal in Pegasus Birds in relation to the assessment the penalty was based on.

Supreme Court rules on the scope and limitations of the enterprise zone tax incentive (R (oao Cobalt Data Centre) v HMRC)

The Supreme Court unanimously dismissed the taxpayers’ argument that the relevant expenditure fell within section 298(1) of the Capital Allowances Act 2001 (CAA 2001) and concluded that, based on the proper interpretation of that provision, the expenditure was not incurred under a contract executed prior to the conclusion of the initial ten-year period, as required. Adam Craggs, partner at RPC, discusses the implications that the judgment has on taxpayers going forward.