Tax avoidance with hybrid financial instruments among European countries

Resource Information

The work Tax avoidance with hybrid financial instruments among European countries represents a distinct intellectual or artistic creation found in International Bureau of Fiscal Documentation. This resource is a combination of several types including: Work, Language Material, Continuing Resources.

Label

Tax avoidance with hybrid financial instruments among European countries

Creator

• Holtmann, S

Subject

• ATAD 2
• MNE
• anti-avoidance
• debt
• equity capital
• ATAD
• hybrid mismatch
• linking rules
• securities
• tax avoidance
• hybrid financial instrument

Language

eng

Summary

Multinational companies can use hybrid financial instruments (HFIs) to reduce their tax burden. To achieve such a reduction corporations can exploit the differences that exist between countries in respect of their national tax laws. By evaluating the rules governing separation between equity and debt in Germany, France, the UK, the Netherlands, and Luxembourg, this article finds that there are various qualification conflicts which give rise to tax avoidance opportunities in these countries. The implementation of linking rules, a central anti-avoidance mechanism recommended by the OECD, has reduced the revealed tax avoidance opportunities over time. Considering ATAD I and ATAD II, this article analyses former, current, and future tax avoidance opportunities resulting from the use of HFIs

Citation source

In: British tax review. - London. - (2020), no. 2 ; p. 217-240

Geographic coverage

• Europe
• European Union

Language note

English