Treasury
Deloitte’s Treasury Tax team works closely with treasury and tax departments across a broad range of UK and multinational corporate groups, and financial institutions.
We provide specialist advice on treasury and capital markets transactions including the taxation of financing and cash investment transactions, foreign exchange and derivative contracts.
We provide a range of services from reviewing existing treasury operations from a tax perspective to adding value to commercial transactions by ensuring the transaction steps are tax efficient. This has resulted in significant cash savings for many of our clients.
Issues and trends
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Treasury Matters Access our quarterly newsletter for those with responsibility for tax and treasury. |
Treasury is high up the agenda of most corporate groups right now, due to the continuing uncertainty and volatility in the financial markets. As a result, our tax treasury team is currently advising clients on:
- the taxation of foreign exchange gains and losses on loan balances (intra-group and external);
- the taxation of movements in the fair value of derivative contracts (e.g. contracts hedging FX, interest rate and commodity price risk);
- transactions involving the repurchase of companies’ issued debt at a discount to par value; and
- the proposed adoption of “IFRS for SMEs” by the majority of UK companies, recently re-drafted and scheduled to take place from 1 January 2015, which can have a significant impact on the taxation of financial instruments.
For further information on how we can help you please contact one of our group partners, Stephen Weston and Ben Moseley.
Our Solutions
Working with clients to review the tax treatment of their treasury operations generally, our team identifies potential existing exposures and develops solutions for those, provides our clients with enhanced awareness of the tax treatment of their treasury transactions and adds significant value as illustrated by the case studies below:
- We reviewed a company’s bonds and hedging swaps and identified an error in how the company had treated these instruments on initial adoption of IFRS. As a consequence, the tax treatment of the instruments was incorrect – potentially leading to overpaid tax of several £millions in a single year. We are now advising the company on correcting the position and reclaiming the overpayment.
- A UK company used financial instruments to hedge a debt issue. The company assumed that certain tax rules which disregard Fair Value Movements would apply to the hedging transactions and did not claim any deduction for the resultant fair value loss. As part of a wider review, we concluded that these rules should not apply and developed a solution to remove volatility going forward, whilst locking in a substantial tax loss following HMRC clearance for the tax position.
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