| Algeria | Interest income from Government bonds: On 14 April 2016, the Algerian Tax Administration has introduced a note relating to the issuance of government bonds. Accordingly, from 17 April 2016 interest relating to those bonds will benefit from a tax exemption. See the story in Regfollower |
| Canada | Incentive for small business: Under the Canadian current legislation, the effective small business tax rate is set to be reduced by 0.5 percentage points each year, until it reaches 9% in 2019. However, the Canadian Government has since proposed maintaining the current 10.5% rate. GAAR: Canada has amend the anti-avoidance rules in section 55 of Canada’s income tax law that prevent the conversion of capital gains into tax-deductible inter-corporate dividends and make consequential stock dividend changes in section 52. See the story in Regfollower |
| Chile | WHT Return : In Resolution No. 28 issued on 5 April 2016, the IRS requests to Chilean companies if interested in claiming withholding tax exemptions for commissions paid abroad from 2010 through 2014, on transactions that were not reported to tax authorities to file Form 1854 electronically by 30 June 2016. Those Companies now can report the 2010 through 2014 commissions with their 2015 commission payments. See the story in Regfollower |
| Colombia | Interest rate: For tax year 2016, an annual interest rate of 5.22% applies to any loan granted by a company to its shareholders or by the shareholders to the company. Penalties for late returns: In a recently published Ruling 4024 of 2016, the National Tax Authority pronounced on the applicable rules for taxpayers having failed to submit tax returns electronically but being willing to correct the error voluntarily however, in that case, the taxpayer will incur a penalty. See the story in Regfollower |
| Czech Republic | Sanctions for tax evasion: On 27 April 2016, the Senate published an amendment to the Criminal Code to the effect that even the act of preparing for tax evasion is a criminal offence. According to the amendment, the new provision seeks to address those actions which have the signs of a future criminal offence. Rather than targeting tax optimization scenarios, this provision applies to the instances of deliberate tax evasion. See the story in Regfollower |
| France | Incentives: The Ministry of Finance and Public Accounts has announced that the tax measure allowing companies to use an amortization base of 140% on certain industrial investments will be extended by 1 year. Accordingly, for investments in qualifying industrial, manufacturing and scientific research equipment that are made between 15 April 2015 and 14 April 2016, the taxpayer may increase the usual amortization base by 40% (i.e. the investment will be amortized on 140% of its cost). See the story in Regfollower |
| India | Foreign tax credit: India’s Central Board of Direct Taxes (CBDT) issued the draft rules: F. No. 142/24/2015-TPL, concerning the foreign tax credit and specifying the procedure for granting relief for income taxes paid in another country of foreign territory. As per Section 295(2) (ha) of the Income-tax Act, 1961 (the Act) the Central Board of Direct Taxes (CBDT) may prescribe rules specifying the procedure for the granting of relief or deduction under Section 90, 90A or 91 of the Act of any income-tax paid in any country or specified territory outside India, against the income-tax payable under the Act. Therefore, the CBDT had set up a committee to suggest the methodology for grant of Foreign Tax Credit (FTC). See the story in Regfollower |
| Ireland | Surcharge for late submission of returns : On 14 April 2016, the Irish Revenue published eBrief on the surcharge for late submission of returns. Section 1084 TCA 1997 imposes a surcharge on corporate taxpayer, for the late filing of a tax return. With effect from 23 December 2014 (the date of passing of Finance Act 2014) a taxpayer will not be liable to a surcharge where a penalty is applied under section 1077E for the deliberate or careless making of an incorrect return, provided the return was made in a timely manner in the first instance. Capital gains tax compliance: The Return filing date for CGT is the same as for income tax, 31 October. The due date for filing a return of capital gains realized in a tax year is the 31 October following the year of assessment in which the disposal of the asset occurs. The Form-11 also contains a section on which chargeable gains can be returned by the taxpayer. See the story in Regfollower |
| Malta | E-filling deadline: The Inland Revenue Department has been extended the 2016 year of assessments tax return deadlines. These extensions apply only to electronic filing of corporate income tax returns, and not to tax payments. Manual tax returns and all tax payments must reach the department by the due dates contemplated by the Income Tax Acts. See the story in Regfollower |
| Russia | CFC Rule: The Federal Tax Service (FTS) has published a Letter No. ED-3-13/1427 on 4th April 2016 for describing the time limits for submission to the tax authorities of notifications on controlled foreign companies (CFCs) and the necessary documents substantiating the exemption of CFC profits in Russia. On the basis of section 3.1 of article 23 and section 2 of article 25.14 of the Tax Code, taxpayers are needed to submit the notifications on CFCs on or before 20th March of the year following that in which the person controlling the CFC accounts for the profits of the CFC. See the story in Regfollower Dividend income: The Federal Tax Service (FTS) has issued a letter no. SD-4-3/2765 on 19th February 2016 for clarifying the tax treatment of dividends received. Accordingly, under the section 1 of article 284 (3) of the Tax Code, dividends received by resident companies from other resident companies are exempt from corporate income tax and withholding tax (participation exemption) if certain conditions are fulfilled. One of those conditions is that the recipient company should hold the shares in the distributing company for a minimum uninterrupted period of 365 days. See the story in Regfollower |
| Slovenia | Main corporate tax rate: Recently, the government publishes proposal for amendments to the corporate income tax law and according to the proposal, the corporate income tax rate will increase to 20% from, 17%. See the story in Regfollower |
| Turkey | Interest rate: On 7 April 2016, the Revenue Administration published Corporate Tax Circular No. 40 on the capital increase deduction. The circular indicates that the annual weighted average interest rate for 2015 is 14.6%. See the story in Regfollower |
| Ukraine | Late payments of tax due: According to the transitional provisions of the Tax Code, from the 2015 tax year no tax penalties are due regarding mistakes in corporate income tax returns and/or underpayment of corporate income tax liabilities. The SFS also clarified that only tax penalties calculated based on the amount of underpaid corporate income tax (article 123 of the Tax Code) would not be due. Interest calculated based on the official interest rate of the National Bank still applies. See the story in Regfollower |
| Vietnam | Incentives: The Ministry of Finance on 7 April 2016, published Official Letter No. 4769/BTC-TCT which providing criteria on tax incentives for regular investment activities. As per this guidance, “regular investment activities” is defined as regular additions to machinery and equipment of the original project enjoying CIT incentives. See the story in Regfollower |
| Portugal | Loss carry-forward: From March 30, 2016, The Portuguese Parliament has approved the State Budget Law for 2016 (Law 7-A/2016). Accordingly, the tax losses carry forward period will be reduced from the current 12 years to five years for larger companies, for tax years beginning on or after January 1, 2017. This means the tax losses assessed in 2016 still benefit from the current time period (12 years). Participation exemption: The participation exemption regime will be modified and a holding period of 1 year instead of the current 2 years will be required. Furthermore, the required minimum shareholding will be increased from 5% to 10%. See the story in Regfollower |
| Romania | Liability to Tax: From 2016, Romania has introduced the definition of place of effective management, which represents the place where strategic decisions for the activity of the foreign entity are taken or the place where the executive directors perform their activities in respect of the foreign entity. Foreign legal entities with the place of effective management in Romania are considered taxpayers for CIT purposes. Dividend income: The new tax code also include, making dividend income tax-exempt for Romanian holding companies, as long as the dividends are provided by their Romanian subsidiaries. The standard WHT rate was reduced to only 5% for dividends not qualifying under the participation exemption regime. See the story in Regfollower |
