Carried interest exclusion from CGT – transitional rules won’t apply after 22 November 2017
Wed 22 Nov 2017
Rules will be introduced to simplify and to prevent manipulation of pre-existing rules to reduce tax payable on disposal of carried interest.
On disposal of carried interest, certain amounts were excluded from capital gains tax where they related to a previous disposal of assets before specific dates. These were known as transitional provisions and applied to carried interest acquired on or after 8 July 2015. This led to a perceived manipulation of the rules to reduce tax in ways that HMRC did not intend. As a result of the Chancellor’s announcement, the transitional rules will not apply to disposals of carried interest arising after 22 November 2017.
While this announcement will simplify the capital gains tax calculations, it will adversely affect those in the private equity and investment management sectors.
For more information contact Stephen Brown (Stephen.j.brown@mazars.co.uk) Paul Clement (paul.clement@mazars.co.uk) or Ian Thomson (ian.thomson@mazars.co.uk)
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