Just before Christmas, US President Donald Trump achieved his biggest – and most controversial - legislative triumph to date: that being the biggest rewrite of the nation’s tax code since 1986.
The most widely published changes impact the taxation of US businesses, with the largest ever cut in corporation tax - from 35% to 21% - dominating headlines and showing a definite intent to make the US more competitive.
The corporate changes included the move to a so-called territorial system of taxation and rules designed to encourage US Parent companies to repatriate profits earned through subsidiaries abroad back into the US, all with the stated aim of discouraging American jobs, headquarters and research from leaving the country.
Individuals though were not excluded from the tax changes. High earners will see a reduction in marginal tax rates, the Estate/Gift tax threshold is doubled while certain deductions are also limited or abolished. US resident owners of foreign corporations may also be directly impacted by the corporate tax changes in ways not widely understood. Whether the Republicans have achieved their stated goals of both making the tax system fairer and boosting economic growth is something which should definitely be reviewed.
But whatever the long-term impact, the new rules will have immediate and wide ranging repercussions for entrepreneurs, business owners, high earners and investors who are either US citizens or have financial interests in US assets.
Replay our webinar to hear US/UK tax specialists Jeffrey Gould and Michael Lewis unpick the headlines and give an overview on what the Tax Cuts and Jobs Act 2017 could mean for you, your business, investments and financial affairs.
Trump’s Tax Reform Tsunami Leaves Devastation in its Wake - It’s rare that we humble U.S. tax professionals can expect much attention outside our small circle of clients and colleagues,…
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