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Approved Changes (6)

Brazil

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Brazil Issues Selection Criteria for Differentiated and Special Tax Monitoring Program for 2016

On 24 December 2015, Brazil published Ordinance 1,755/2015 in the Official Gazette, which sets out the selection criteria for the differentiated and special tax monitoring program for 2016.

Differentiated tax monitoring involves periodic evaluations of a taxpayer's tax behavior and collection of taxes to identify any inconsistencies. If inconsistencies are identified, the taxpayer is listed as a priority for auditing purposes. Special tax monitoring applies only for large corporate taxpayers and involves additional actions to ensure priority treatment to conclude any tax demands and disputes.

For 2016, corporate taxpayers will be subject to differentiated tax monitoring if any of the following conditions are met:

  • Annual gross income exceeding BRL 165 million in the 2014 fiscal year;
  • Declared tax debits in the tax return exceeding BRL 17 million in the 2014 fiscal year;
  • Annual payroll exceeding BRL 40 million in the 2014 fiscal year; or
  • Social security contribution (INSS) and employer's contribution to the unemployment guarantee fund (FGTS) debits exceeding BRL 14 million in the 2014 fiscal year

For 2016, large taxpayers will be subject to special tax monitoring if any of the following conditions are met:

  • Annual gross income exceeding BRL 1 billion in the 2014 fiscal year;
  • Declared tax debits in the tax return exceeding BRL 100 million in the 2014 fiscal year;
  • Annual payroll exceeding BRL 135 million in the 2014 fiscal year; or
  • INSS and FGTS debits exceeding BRL 45 million in the 2014 fiscal year

For individual taxpayers, an annual income threshold of BRL 14 million in 2014 and certain other conditions apply.

The above conditions apply for 2016. The conditions will also apply for future years if no subsequent ordinance is issued.

France

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France Individual Income Tax and Social Security Caps for 2016

The French individual income tax brackets and rates for 2016 are as follows:

  • up to EUR 9,700 - 0%
  • over EUR 9,700 up to 26,791 - 14%
  • over EUR 26,791 up to 71,826 - 30%
  • over EUR 71,826 up to 152,108 - 41%
  • over EUR 152,108 - 45%

The salary basis caps for social security purposes are as follows:

  • Annual basis - EUR 38,616
  • Monthly basis - EUR 3,218
  • Daily basis - EUR 177

The changes apply from 1 January 2016.

Greece

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Greece Publishes Non-Cooperative and Preferential Tax Regimes Jurisdictions List for 2015

On 29 December 2015, the Greece's Public Revenue Authority published the list of jurisdictions that are considered non-cooperative or considered to have preferential tax regimes for the 2015 tax year. Inclusion in the list affects a number of tax matters, including the deductibility of expenses, the participation exemption and the controlled foreign company regime. Non-cooperative jurisdictions are those that do not have an in-force agreement with Greece on administrative assistance in tax matters, and preferential tax regimes are those with a corporate tax rate that is 50% of Greece's rate (29%) or lower. The list includes:

Albania, Andorra, Anguilla, Bahamas, Bahrain, Belize, Bermuda, Bonaire, Bosnia and Herzegovina, British Virgin Islands, Bulgaria, Cayman Islands, Cyprus, Gibraltar, Guernsey, Ireland, Isle of Man, Jersey, Jordan, Liechtenstein, Macau, Macedonia, Maldives, Marshall Islands, Moldova, Monaco, Montenegro, Montserrat, Nauru, Oman, Paraguay, Qatar, St Eustatius, San Marino, Saudi Arabia, Seychelles, Turks and Caicos Islands, United Arab Emirates and Vanuatu.

Taiwan

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Taiwan Extends Reduced Stock Index Futures Transaction Tax

On 30 December 2015, Taiwan's Ministry of Finance announced that the reduced transactions tax rate of 0.002% for stock index futures is extended to 31 December 2018. Taiwan's transactions tax on futures varies depending on the type. The standard rate for stock index futures had been reduced from 0.004% to 0.002% from 1 April 2013, and the reduction was to expire the end of 2015.

United Kingdom

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UK Publishes MoU with Northern Ireland on Corporate Tax Rate

On 7 January 2016, the UK HMRC published the memorandum of understanding (MoU) signed between HMRC and the Northern Ireland Executive’s Department of Finance and Personnel, Northern Ireland (DFPNI) for the implementation of the devolved corporate tax rate in Northern Ireland. The Northern Ireland Executive and the UK and Irish governments agreed to the implementation of a 12.5% Northern Ireland Corporation Tax (NICT) from 2018 under the Stormont Agreement and Implementation Plan.

According to the MoU, the NICT is to be set by the Northern Ireland Assembly prior to each financial year. The NICT rules and policy will form part of the UK Corporation Tax system and will be administered by HMRC. Large companies with a permanent place of business or dependant agent acting on their behalf in Northern Ireland will need to allocate their profit accordingly for the application of the NICT. For small and medium-sized enterprises, all UK trading profits will be subject to NICT if at least 75% of their employment costs and time arises in Northern Ireland. Company Tax Return (CT600) will be amended and a supplementary page added to administer the NICT regime.

Click the following link for the Memorandum of Understanding on the Northern Ireland Corporation Tax Rate between the Department of Finance and Personnel, Northern Ireland and HM Revenue & Customs.

Venezuela

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Venezuela Enacts Financial Transactions Tax

On 30 December 2015, Venezuela enacted the Law on Large Financial Transactions. The law introduces a new non-deductible financial transactions tax (FTT) at the rate of 0.75% that will apply for legal persons designated as special taxpayers, as well as legal persons related to special taxpayers (designation made by tax authority based on gross income or engagement in certain activities). The FTT will apply to:

  • Debits to bank accounts and certain other deposits;
  • Debits to accounts for cross-border payments;
  • Transfers of bonds and securities, unless issued by the Venezuelan Central Bank or government;
  • Payments of debts outside the financial system; and
  • Certain other transactions.

It will not apply for transactions between accounts of the same holder.

The FTT is to be withheld by the relevant bank or financial institutions at the time of the transaction. If the transaction is outside the financial system, the tax is to be reported and paid by the taxpayer according to the applicable schedule for special taxpayers. It applies from 1 February 2016.

Treaty Changes (2)

Andorra-Ukraine

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TIEA between Andorra and Ukraine to be Signed

On 30 December 2015, the Ukraine government issued a decision authorizing the signature of a tax information exchange agreement with Andorra. The agreement will be the first of its kind between the two countries and is in line with the OECD standard for information exchange. It must be finalized, signed and ratified before entering into force.

Denmark-Philippines

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SSA between Denmark and the Philippines has Entered into Force

According to an update by the Danish Ministry of Foreign Affairs, the social security agreement with the Philippines entered into force on 1 December 2015. The agreement, signed 11 September 2012, is the first of its kind between the two countries and applies from the date of its entry into force.

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