The new PSD general anti-abuse rule

On 27 January 2015 the EU Council adopted Directive 2015/121 a proposal of the European Commission to amend the Parent-Subsidiary Directive 2011/96/EU (‘the PSD’) to include a general anti-abuse rule (‘the EU GAAR’) into the existing directive. The amendment is aimed at preventing taxpayers from gaining the benefits of the PSD through the use of artificial arrangements which do not reflect economic reality.

 

The EU GAAR represents one element of a wider Commission campaign to tackle tax avoidance and to shift the focus of anti-avoidance policy to the supranational level. The effects of the EU GAAR will be felt in...