IFM37330 - Foreign chargeable gains: Low tax jurisdictions

Low tax jurisdictions

The successful performance of a fund which generates carried interest does not arise from tax efficient holding structures but the management of genuine underlying business operations. This is especially true where services based in low tax jurisdictions are labelled as marketing services, investor relations or other vague descriptions which seek to disguise the real contribution of value by the management team in the offshore financial centres where they are normally based.

The correct proportion of carried interest applicable to UK taxation will not be affected by the attempt to disguise the legitimate underlying investment management services.