New tax measure could put GBP 20bn in development funding at risk

New tax measure could put GBP 20bn in development funding at risk

Published at: 2017-02-23 11:39 | Author: iBroadcastPR
The UK government’s effort to crackdown on corporate tax evasion could put GBP 20bn in development funding at risk, the the British Property Federation (BPF) is warning. A series of complex measures proposed by the government will place a limit on companies that claim interest as a tax-deductible business expense stemming from debt owed to overseas subsidiaries. However the BPF argues that this is, for the most part, a non-issue for the property industry. Third-party real estate debt is usually provided by a bank in the same country where the asset on which it is secured is located. The BPF says that the new rules the government wants to put in place will place unnecessary restrictions on credit developers depend on.
“Our internationally backed rules will stop multinationals artificially shifting taxable profits overseas through interest payments,” a A Treasury spokesperson told media outlets. “In line with evidence presented during our consultation, including from the British Property Federation, we’ve made sure that companies that fund infrastructure through debt, including rental property projects, are able to continue to use third-party debt to fund their projects.”

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