Branch capital – are we any the wiser?

In this article Simon Leach of PricewaterhouseCoopers looks at the new branch capital legislation and the background to its introduction and considers whether the legislation, as it is currently drafted, is likely to raise the projected revenues.

Simon Leach is a Tax Manager at PricewaterhouseCoopers, London. He can be conacted on +44 (0) 20 7213 2746 or by email at simon.j.leach@uk.pwcglobal.com.

On 25 July 2002, the Inland Revenue published draft legislation setting out the proposed changes to the taxation of UK branches of overseas companies. The UK Treasury estimates that these new rules will raise additional tax revenues of £1billion over the next two financial years.