Why tax matters when making investment decisions
Tax is just one factor to consider when making decisions
about business investment, writes Margaret Connolly, partner and
head of taxation at Reeves.
The UK has a number of significant non-tax advantages
from the perspective of international business.
An open and politically stable society, the benefits of
common law jurisdiction, and a well-educated workforce that
supports an enviable reputation in scientific discovery and
technological innovation. There is also the English
Kent offers all these advantages and special ones of its
own - easy reach of London, lower costs, on the doorstep of
Continental Europe and support structures needed for business
The recent Budget was billed as "unashamedly" in favour of
business and contained measures of interest to potential inward
The main rate of Corporation Tax (CT) has fallen to 24%,
giving the UK the lowest CT rate in the G20.
As for tax reliefs, the already generous system of R&D
tax credits will be further enhanced by allowing larger companies
to obtain a repayable "above the line" credit from April 1,
Innovation is further encouraged by the introduction of
the Patent Box regime, which will allow corporate income and gains
generated from patents to be subject to a special CT rate of
In addition, a number of tax reliefs are to be introduced
next year to attract video game design, animation and high-end
television production to the UK.
Finally, the 50% rate of personal income tax for those
earning in excess of £150,000 is reduced to 45% from April 6,
UK companies can receive inbound dividends on a tax free
basis, while the UK does not impose withholding tax on outbound
n Contact Margaret Connolly on 01227 768231 or email
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