Moore Stephens says UK Budget is neutral for shipping and good for offshore

International accountant and shipping adviser Moore Stephens says the UK Budget 2017 contained no unwelcome surprises for the shipping industry, and some good news for the offshore sector.

Moore Stephens tax partner Sue Bill says, “There are new rules, already announced, that will affect the deductions which a UK group can be claim for interest expenses. The new tax rules will restrict each group’s net deductions for interest to 30% of earnings before interest, tax, depreciation and amortisation (EBITDA) that are taxable in the UK. These rules should not affect tonnage tax companies, as those companies have no deduction for interest paid within the tonnage tax ring fence.

“There is also a reference to the government consulting later this year on legislative changes required following the announcement of the International Accounting Standard Board’s new leasing standard IRFS 16 Leases, which comes into effect from 1 January 2019. The government intends to maintain the current system of leased taxation by making legislative changes which enable the rules to continue to work as intended.

“HMRC has also confirmed that the new rules being introduced from April 2017 for non-UK domiciled individuals (‘non-doms’) will apply from 6 April 2017 for those who have been UK-resident for 15 out of the past 20 tax years.

“Improvements to the oil and gas regime, meanwhile, include an extension to investment and cluster area allowances, and tax for late-life oil and gas assets. These are aimed at improving the attractiveness of the North Sea as an area for investment.

“There have been no changes to the shipping rules, in particular those within the UK tonnage tax regime or in the taxation of non-resident shipping companies. Overall, this is probably a case of no news being good news for the shipping sector.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 626 offices of independent member firms in 108 countries, employing 27,997 people and generating revenues in 2016 of $2.7 billion. www.moorestephens.co.uk


For more information:
Sue Bill
Moore Stephens LLP, London
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com

Moore Stephens says Autumn Statement bodes well for UK business stability

International accountant and shipping adviser Moore Stephens says the Autumn Statement from the UK Chancellor of the Exchequer should provide stability for UK businesses.

Moore Stephens tax partner Sue Bill says, “While there are no new developments relating specifically to the shipping industry, there are a number of items worthy of note. It was confirmed that the corporation tax rate will be 17% from April 2020, and will not be further reduced. Rules will be introduced to limit the tax deduction that large groups can claim for interest expenses from April 2017. These will apply where a group has net interest expenses of more than £2 million, where these expenses exceed 30% of UK taxable earnings, and where the group’s net interest earnings ratio in the UK exceeds that of the worldwide group.”

Corporation tax loss relief rules will also be changed with effect from April 2017, with the result that the amount of profit that can be offset by carried-forward losses will be restricted to 50% after a £5 million allowance. There will be greater flexibility, however, with regard to the types of profit that can be relieved by tax losses brought forward.

For the oil and gas sector, the process to opt a field out of Petroleum Revenue Tax, which is now at a rate of 0%, has been simplified in order to reduce administrative costs.

It has been confirmed, meanwhile, that reforms to the taxation of non-UK domiciled individuals will be brought in from April 2017. Moore Stephens tax partner Gill Smith says, “These rules will end the permanency of the non-domiciled tax status and introduce inheritance tax for UK residential property where it is held indirectly by a non-domiciled individual through an offshore structure. In addition, Business Investment Relief rules will be changed to make it easier for non-domiciled individuals taxed on the remittance basis to bring offshore money into the UK for the purpose of investing in UK businesses.”

Others measures announced in the Autumn Statement include confirmation of reforms to the Substantial Shareholdings Exemption (SSE) rules, the introduction of further incentives to encourage research and development, and a review of the rules relating to the taxation of benefits in kind. The government has also reiterated its commitment to reduce offshore tax evasion and aggressive tax avoidance schemes.

Sue Bill says, “The Autumn Statement appears to place the emphasis on stability for UK business which, given recent events, would seem to be good news, not least for the shipping sector. “

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 657 offices of independent member firms in 106 countries, employing 27,613 people and generating revenues in 2015 of $2.7 billion. www.moorestephens.co.uk

For more information:
Sue Bill
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com

Bureau Veritas appoints new offshore lead

Leading international classification society Bureau Veritas has appointed Matthieu de Tugny as Senior Vice President in charge of Offshore activities within the Marine & Offshore Operating Group. He is tasked with driving forward Bureau Veritas Group initiatives in the oil and gas offshore market and enhancing Bureau Veritas’ technical leadership and recognition in this market.

Matthieu de Tugny says, “I am proud to take over the leadership of a team of real experts with deep knowledge of the offshore energy field. At a time of falling and volatile oil prices we can bring added value to the sector, with expertise to get the best out of existing assets.”

Philippe Donche-Gay, Executive Vice President, Marine & Offshore Operating Group, says, “Bureau Veritas is very firmly one of the top classification societies in the world active in oil & gas offshore energy, with leadership positions in floating production platforms and offshore support vessels. Under the leadership of Mathieu de Tugny, we will keep on providing a very wide range of services which help ensure that offshore energy players operate both safely and cost-effectively.”

Matthieu de Tugny graduated from the Ecole Nationale de la Marine Marchande, France and from the Ecole Supérieure d'Electricité, France as an engineer. He started his career at Bureau Veritas in 1994 in the Electricity and Automation Section. After experience in Korea, he was appointed, in 2000, as Containership and Bulk Carrier Manager. In 2002, he became Chief Executive for Marine France. In 2007, he was appointed Marine Chief Executive for the United States and Canada. Since 2012, Matthieu de Tugny has been Vice President, South Asia Zone for the Marine & Offshore Division.

For a photo of Matthieu de Tugny click on http://bit.ly/1jw4QLQ or e mail chris@merlinco.com

Bureau Veritas is a world leader in conformity assessment and certification services. Created in 1828, the Group has 61,000 employees in around 1,330 offices and laboratories located in 140 countries. Bureau Veritas helps its clients to improve their performance by offering services and innovative solutions in order to ensure that their assets, products, infrastructure and processes meet standards and regulations in terms of quality, health and safety, environmental protection and social responsibility.

www.bureauveritas.com for corporate information

www.veristar.com for marine information


For more information:

Philippe Boisson
Bureau Veritas
+33 (0)1 55 24 71 98
philippe.boisson@bureauveritas.com

Moore Stephens says Budget 2014 continues stable tax regime for UK shipping

International accountant and shipping adviser Moore Stephens say the UK government’s Budget 2014, issued on 19 March 2014, is good news for UK shipping as it ensures the continuation of a stable UK tax regime for shipping, as has been the case for the past few years.

Moore Stephens tax partner Sue Bill says, “Overall, Budget 2014 is fairly neutral for shipping. The main surprise is the restriction of the proposed rules on capping the amount of tax relief for intra-group leasing payments for large offshore oil and gas assets under bareboat charters to certain assets only, reducing the impact on the shipping sector. The scope of the measure will be limited to drilling rigs and offshore accommodation vessels. All other vessels, including FPSOs, seismic vessels and heavy lift vessels, will be excluded.

“Following consultation with industry, a number of other changes have also been made to the proposed rules; the government will review the impact of the measure a year after implementation; the cap on the bareboat deduction will be increased from 6.5 percent to 7.5 percent; and the pro-rata calculation will be based on worldwide use of the vessel. Draft legislation will be published on 1 April 2014, when the measure will come into effect.”

A number of other announcements were made in the Budget which will affect the UK’s oil and gas tax sector. Sue Bill explains, “The Treasury will review the oil and gas fiscal regime to ensure that it continues to incentivise economic recovery, the government will be consulting on a new allowance to support investment in ultra-high-pressure, high-temperature projects, and it will work with industry to ensure that the UK has the right skills to benefit from the country’s oil and gas resources.

“Other measures which may be of interest to UK shipping groups include the government’s decision to extend the UK tax rules applying to high-value UK residential property held by non-natural persons, so that they will also apply to properties worth between £500,000 and £2 million. Stamp Duty Land Tax (SDLT) will apply at 15 percent on acquisition of a residential property, and there will be an annual tax on enveloped dwellings (ATED), and capital gains tax at 28 percent on any gain on disposal.

“Finally, the government has continued to emphasise its commitment to tackling tax avoidance and aggressive tax planning on the part of large businesses exploiting international tax rules in order to avoid paying tax, for example, by manipulating the UK transfer pricing rules or exploiting double tax treaties. Additional anti-avoidance rules have been announced. For example, where companies transfer profits within a group in order to obtain a corporation tax advantage, the position will be as though the transfer had not taken place. Further rules will be introduced to prevent the artificial use of dual contracts by non-domiciled individuals."

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping and insurance adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 667 offices of independent member firms in 105 countries, employing 27,081 people and generating revenues in 2013 of $2.7 billion. www.moorestephens.co.uk


For more information:
Sue Bill
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com