Thursday, 21 June 2018 09:47

PRISM Tax Newsletter- 2nd Quarter 2018 issue

The latest issues of PRISM – the quarterly tax newsletter, which is part of Reanda’s effort to stay in touch with our clients by sharing updates and insights on the recent taxation changes and current hot topics.
Read the publication.

Highlights

Australia
Part One
1. What is a trust?
2. What elements are required to form a valid trust structure?
3. How does trust integrate with the legal framework?

Part Two
4. How trust differs from other business structures?
5. Why using a trust?
6. How does a trust end?
7. What taxation implications or advantages from the use of a trust structure?

Germany
With the persistent rising of prices in the German real estate market, more investments by are made international companies are made. These investments are financed and managed by affiliated companies abroad. With the steadily rising amount of loans between related companies the German tax authority set a focus on the pricing of loans and financial transaction in tax audits. Therefore, it is essential that investors deal with the applicable pricing methods and their functionalities. The principle of dealing at arm´s length has to be applied. When it comes to the pricing of loans, certain requirements and obligatory documentations have to be met and prepared.

Hong Kong
The newly signed tax treaty sets out the allocation of taxing rights between the two jurisdictions and will help investors better assess their potential tax liabilities from cross-border economic activities.

Malta
Companies in Malta are taxed at a rate of 35%. However, a full imputation system applies to the taxation of dividends, whereby the tax paid by the company is imputed as a credit to the shareholder receiving the dividend. Following the distribution of a dividend, shareholders are also entitled to claim a tax refund on the tax paid by the company.
Malta’s tax system has been deemed by the European Commission to be compliant with EU non-discrimination principles and has also gained approval from the OECD.

Portugal
Over the last three decades, China has been experiencing an impressive economic expansion in its growth rate, with an average annual rate of 9%, stand out with references like Singapore, South Korea, Thailand and India with the among grew over the same period.
With growing cross borders as well, China has a strong presence in a number of PALOP countries where the differences from the integration of cultures and economies is what makes this process complex from the fiscal point of view.
In this text, we present briefly some of the major advantages, disadvantages and differences between the various markets such as Portugal, Brazil, Cape Verde, Angola and Mozambique.

UK
Finance Act 2017 made several changes to the taxation of lump sums and foreign pension income as there is a desire to align the tax treatment of UK registered pension schemes with non-UK pension schemes. This article gives a summary of how the taxation of non-UK pensions have altered due to changes in the legislation.
These changes are relevant to clients who have been living overseas but are considering a retirement in the UK. They should be made aware of the new tax treatment of non-UK pensions before they re-establish UK tax residences so correct retirement planning can be advised.

China
“Beneficial owners” have been one of the issues in international taxation. This Interpretation of the State Administration of Taxation has, in addition to clarifying the standards for determination of the capacity of “beneficial owners”, made amendments to the prior Notice, specifying that evidence shall be provided to certify the capacity of “beneficial owners”, and efforts shall be made to prevent risky arrangements under tax treaties.

Cyprus
Cyprus’ House of Representatives approved the introduction of revised tax incentives for investment in innovative businesses.
The new incentives granted for investment in innovative SMEs are effective from 1 January 2017 for a three-year period and replace the previous incentives that were available to investors until 31 December 2016.

Malaysia
The self-assessment system (SAS) for taxpayers was implemented in stages, since yea of assessment (YA) 2001 for companies; and, since YA 2004 for individuals (include salaried employees and sole proprietors) and partnerships. The main objective of implementing SAS is to encourage tax compliance by the taxpayers and reduce administrative burden of the Inland Revenue Board (IRB). The responsibility of computing the taxpayer’s liability is shifted form the IRB to the taxpayers.

Singapore
Budget 2018 is a strategic and integrated plan to position Singapore for the future. It supports our transformation into a vibrant and innovative economy, and a smart, green and liveable city. It also fosters a caring and cohesive society while ensuring a fiscally sustainable and secure future for Singapore. It is also to address the problem of rising education, healthcare & security and other social costs. Singapore expects an overall budget surplus of $9.6 billion or 2.1% of GDP for the financial year 2017 which will be used to save ahead for future spending in infrastructure, education and healthcare in 2018 and beyond.

UAE
After the introduction of Excise Tax from 1st October 2017 it was almost certain that the UAE government would introduce Value Added Tax (VAT) and as expected VAT has been introduced and implemented with effect from 1st January 2018 in the UAE. UAE is the second GCC country to implement VAT along with Saudi Arabia.
The implementation has been embraced by the business community comfortably within a short span of time with extra-ordinary support and guidance from the Federal Tax Authority (FTA). The Laws, rules and regulations have been structured, regulated and enacted like a matured economy and well accepted by the understandable business society.
Generation of Excise Tax and VAT revenue would add a new chapter in the revenue stream of UAE which would be utilized for the development of UAE and would be undoubtedly inculcated and contributed for the society and residents of UAE.