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International Tax Newsletter - Europe & African region

Europe & African region

International Tax Newsletter

Europe and Africa regions

September 2018

This e-newsletter gives you an overview of international tax developments being reported globally by KPMG member firms in the Europe and Africa regions between 1 September and 30 September 2018.

 

Belgium Bulgaria Czech Republic European Union
France Germany Ireland Italy
Luxembourg Netherlands Nigeria OECD
Poland Sweden Switzerland Turkey
United Kingdom      



For a full summary of global tax developments, visit kpmg.com/TaxNewsFlash.

To contact the International Tax Team email internationaltax@kpmg.com.

To register for the International Tax webcasts, click here.

International Tax Newsletter - Europe & African region

Hot Topic

Switzerland - Fresh perspectives – As the Swiss tax reform journey continues, more stability is on the horizon

On 28 September 2018, the Swiss Parliament adopted the Federal Act on Tax Reform and AHV Financing (TRAF), which includes elements of the Corporate Tax Reform III rejected by public vote in February 2017. The link with a social equalization measure is intended to increase public acceptance in case another referendum is called. With a federal framework in place, it is up to the cantons to implement the respective measures in a next step.

What does this new tax reform mean for your company? As Switzerland moves forward with the next stage of reform, find out how your company will be affected and learn more about the measures on the latest blog or check out the dedicated tax reform page.
 

Belgium

Tax legislation approved and regulatory update

Corporate income tax / Innovation - 1 July 2016

The Belgian Parliament has approved a draft law that introduces a deduction for innovation income.

Read more.

Corporate income tax / Notional Interest - September 2018

Following the corporate income tax reform, the regime of the notional interest deduction was adapted. The notional interest deduction rate for an assessment year (e.g. 2020) is calculated on the average return of the 10-year OLO in the months July, August and September of the penultimate year preceding the assessment year (e.g. 2018).

Read more.

Tax compliance / Beneficial ownership - 18 September 2018

Measures included in a law reflect requirements to identify the “ultimate beneficial owners” of Belgian companies, foundations, not-for-profit associations, trusts, and other similar legal entities.

Read more.

Bulgria

Tax legislation approved and regulatory update

Administrative Procedure Code - 1 January 2019

New administrative procedural measures were published in the official gazette and generally will be effective 1 January 2019.

Read more.

Czech Republic

Tax legislation approved and regulatory update

Corporate income tax - September 2018

Taxpayers that receive services from intracompany or external providers need to consider appropriate documentation for purposes of claiming tax deductions.

Read more.

 

Treaties

Double tax treaties - August 2018

A new income tax treaty between the Czech Republic and South Korea is pending ratification.

Read more.

European Union

Proposed legislation

Digital services tax - 8 September 2018

During an informal meeting of the ECOFIN, EU Finance Ministers discussed the recent European Commission’s proposal on a Digital Services Tax.

Read more.

 

Administrative and case law

Various tax areas - September 2018

The EU Tax Centre prepared a summary of EU tax developments that can have both a domestic and a cross-border impact.

Read more.

 

Other

VAT - September 2018

Implementation of a VAT action plan in the European Union is set to start in January 2019. There are some considerations for companies before implementation starts in January 2019.

Read more.

France

Proposed legislation

Corporate income tax / Finance Bill - September 2018

The French government unveiled the draft budget for 2019 that contains tax provisions of the draft Finance Bill for 2019 that would affect companies and individual taxpayers.

  • reform of the regime of tax groups
  • introduction of general anti-abuse clause for corporate income tax purposes
  • modification of patent box regime
  • modification corporate income tax installment payments by large companies

Read more.

 

Administrative and case law

Tax audits / VAT - September 2018

Proof of conformity—that is, evidence that businesses are complying with value VAT collection and reporting rules—has been requested by French tax inspectors during recent tax audits.

Read more.

Germany

Administrative and case law

VAT - September 2018

A claim for deduction of input VAT requires—among other things—an invoice that satisfies certain formal requirements of German VAT law.

Read more.

Participation exemption - 20 September 2018

The CJEU published its decision concerning the compatibility of the German participation exemption regime applicable to dividends originating in third countries with the free movement of capital. The case is: EV v Finanzamt Lippstadt (C-685/16).

Read more.

Ireland

Proposed legislation

Corporate income tax / CFC - 1 January 2019

Ireland’s Department of Finance announced a request for comments on a detailed outline of a proposed framework for Ireland’s controlled foreign company (CFC) regime, scheduled to be effective 1 January 2019.

Read more.

Corporate income tax - 5 September 2018

Ireland’s Department of Finance released Ireland’s Corporation Tax Roadmap setting out the future of Ireland’s corporation tax regime.

Read more.

Italy

Tax legislation approved and regulatory update

Corporate income tax / R&D  - 29 August 2018

A law was published concerning measures for the dignity of workers and enterprises—hence, the “dignity decree” label. Among other, it includes:

  • restrictions on the “hyper” depreciation benefit
  • amendments to the research and development (R&D) tax credit.

Read more.

Luxembourg

Administrative and case law

State aid / Treaties  - 19 September 2018

The European Commission announced the findings of its investigation that the non-taxation of certain profits of a U.S. multinational corporation in Luxembourg did not lead to illegal state aid because the treatment was in line with national tax laws and the Luxembourg-United States income tax treaty.

Read more.

Netherlands

Proposed legislation

CFC / Tax treaties - 25 September 2018

The Dutch government launched an internet consultation seeking comments relating to (1) the Dutch tax treaty policy, and (2) the designation of low-taxed states with respect to proposed controlled foreign companies (CFCs) measures.

Read more.

Income tax / Payroll taxes  - 18 September 2018

The 2019 tax plan includes proposed changes to payroll taxes as well as proposed changes to individual (personal) income tax related to international employment.

Read more.

Tax plan - 2019 18 September 2018

The Dutch government presented the 2019 tax plan to the lower house. The proposed tax measures focus on lower labor costs, addressing tax avoidance and tax evasion, providing an attractive business climate, furthering environmental measures, and practical feasibility.

Read more.

 

Administrative and case law

VAT - 11 September 2018

The Advocate General of the CJEU issued an opinion in a case concerning the recovery of VAT on professional expenses incurred with respect to a proposed but ultimately unrealized sale of shares.

Read more.

Nigeria

Other

VAT - 20 September 2018

Liquidity is arguably the biggest issue facing Nigeria’s fledgling electricity industry, and there may be a number of reasons for this—including the effects of VAT.

Read more.

OECD

Other

Corporate income tax / Tax policy - 5 September 2018 

An OECD report—Tax Policy Reforms 2018—describes the latest tax reforms across 35 OECD members, and identifies major tax policy trends and highlights that economic stimulus provided by fiscal policy, including to a large extent through tax policy, has become more significant.

Read more.

Poland

Proposed legislation

Anti-tax avoidance / Corporate income tax  - 11 September 2018

The Ministry of Finance has proposed measures that would affect Poland’s corporate income tax law and would transpose certain EU law measures (specifically EU directives about anti-tax avoidance and concerning the automatic exchange of financial account information) into Polish law.

Read more.

Corporate income tax / Income tax - 11 September 2018

The Ministry of Finance has proposed measures to regulate the taxation of income derived from cryptocurrency transactions.

Read more.

Corporate income tax / R&D - 11 September 2018

A preferential rate of 5 percent would apply to income from qualified intellectual property rights created, developed or improved by a taxpayer as part of the R&D activities.

Read more.

Exit tax - 11 September 2018

A proposal from the Ministry of Finance would impose an “exit tax” on the transfer of assets from Poland or a change of tax residency.

Read more.

Sweden

Proposed legislation

CFC - September 2018

The Swedish government published a legislative proposal that would impose “stricter rules” on companies subject to low taxation.

Read more.

Payroll taxes - September 2018

Sweden’s Ministry of Finance proposed new rules for taxation of temporary employment in Sweden, but the effective date of these new rules has been postponed.

Read more.

Switzerland

Tax legislation approved and regulatory update

Tax reform / Corporate income tax  - 28 September 2018

On 28 September 2018, the Swiss Parliament adopted the Federal Act on Tax Reform and AHV Financing, which includes elements of the Corporate Tax Reform III rejected by public vote in February 2017.

Read more

Turkey

Tax legislation approved and regulatory update

Foreign exchange rules - 13 September 2018

A resolution published in the official gazette limits the use of foreign currency by residents. Under the resolution, certain “residents” of Turkey cannot determine a contract value or other payment obligations arising from contracts denominated in a foreign currency and cannot index contracts in a foreign currency. 

Read more.

United Kingdom

Tax legislation approved and regulatory update

VAT - 17 September 2018

The HMRC published new Making Tax Digital (MTD) guidance aimed directly at business who will be impacted by MTD for VAT, currently expected to be introduced from April 2019.

Read more.

 

Proposed legislation

Budget - 26 September 2018

The date of Autumn Budget 2018 has been confirmed for 29 October.

Read more.

 

KPMG publications

Brexit’s hidden tax questions for asset managers September - 2018

KPMG in the UK prepared a report on five of the big tax issues that asset managers will need to tackle once the UK has left the EU. 

Read more.

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