HMRC U-Turn

On 4 August 2014, HMRC withdrew its concessional practice published in 2010 in HMRC’s guidance manual RDRM33170 wrt its treatment of foreign income and gains, as it was seeing large numbers of arrangements not considered to be within the intended scope of the concession.

However, since then, there has been a wee change of mind by HMRC:

"To ensure the transitional period does not have an unintended effect, after careful consideration HMRC has decided it will, with effect from today, not seek to apply the change announced on 4 August 2014 to arrangements where the loan was brought into or used in the UK before that date. From today, there is no requirement to repay or replace foreign income and gains collateral with non-foreign income and gains collateral before 5 April 2016."

For why?

"Discussions with representative bodies since the announcement have brought to light that for some loan arrangements it may be difficult or impossible to unwind or replace the foreign income or gains used as collateral."

Well then, HMRC does sometimes listen; after the event.

Tax does have to be taxing.

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