The UK Government has recently confirmed that it will be introducing a new cap on interest deductibility. Under the new rule, the ability of groups to obtain tax relief for interest will be limited by reference to a ratio of their net interest expense to EBITDA. The new rule will apply from 1 April 2017, leaving affected groups with very little time in which to consider its impact and to refinance their existing arrangements.
In the latest issue of McDermott’s newsletter International News, covering international tax topics of interest, we have published an article discussing the proposed rule. Read the full article here.