Tax on outsourcing arrangements

The outsourcing of business functions to third party providers is a common strategy implemented by businesses and other organisations to reduce costs and improve efficiency. In these challenging economic times outsourcing is likely to continue to be an attractive option for organisations looking to cut costs and remain competitive.

 

Outsourcing arrangements take many forms; they may for example comprise joint ventures or pure contractual arrangements for the provision of services span jurisdictions involve transfers of businesses and include the provision of many types of services. Tax can be critical to an effective outsourcing since any tax costs that arise will directly affect the cost savings achieved by the arrangements and could ultimately make such arrangements uneconomical.

 

This article outlines some of the...