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Hybrida missmatchningar i Sverige och EU - Hur klassificeringen av finansiella instrument påverkar beskattning av gränsöverskridande transaktioner

Bengtsson, Sofia LU (2018) JURM02 20181
Department of Law
Faculty of Law
Abstract
In a globalized society border-crossing transactions increase in numbers, which also increases the opportunity for tax arbitrage. A common way to exploit differences in regulations and conduct advance tax planning through, is the use of hybrid financial instruments. This essay aims to account for these instruments and how they are regulated. Hybrid instruments are on the border between dept and equity which implies that differences in taxation of the same transaction arise between different nations. This also leads to that the return or payments connected to these instruments classifies as interest or dividend. This results in hybrid mismatches which often are situations with double deductions or with deduction without inclusion, in other... (More)
In a globalized society border-crossing transactions increase in numbers, which also increases the opportunity for tax arbitrage. A common way to exploit differences in regulations and conduct advance tax planning through, is the use of hybrid financial instruments. This essay aims to account for these instruments and how they are regulated. Hybrid instruments are on the border between dept and equity which implies that differences in taxation of the same transaction arise between different nations. This also leads to that the return or payments connected to these instruments classifies as interest or dividend. This results in hybrid mismatches which often are situations with double deductions or with deduction without inclusion, in other words that a deduction is held for the same payment in two countries or that a deduction for a payment is given in one state without that the corresponding income is taxed in the other state. Interest and dividend are lacking definitions in Swedish taxation law which further complicates the situation.
Following the problems of hybrid mismatches border-crossing character, international harmonization of both regulations and classification concerning hybrid financial instruments is required. There are different interstate alternatives for regulation. The foundation for these are OECD’s BEPS initiative which includes recommendations for how hybrid mismatches should be regulated in national law. The EU anti-tax avoidance directive can be said to have captured the essence of BEPS and made the implementation of these rules binding for the members of the EU. Following the above, the Swedish government during 2018 presented a proposition of new rules of taxation for the business sector. This proposition entails rules for interest deductions in border-crossing situations for associated corporations which aims to prevent some hybrid mismatches. In addition to these regulations, tax treaties affect the use of hybrid financial instruments. During 2017 a multilateral treaty was presented by the OECD which aims to solve conflicts between tax treaties concerning classifications of hybrid instruments and in this way prevent that situations with hybrid mismatches arises. (Less)
Abstract (Swedish)
Allt fler gränsöverskridande transaktioner sker i dagens globaliserade samhälle, vilket ökar möjligheten till skattearbitrage. Ett vanligt sätt att utnyttja skillnader i lagstiftning och genomföra skatteplanering på är användandet av hybrida finansiella instrument. Uppsatsen avser att redogöra för dessa instrument och bakgrunden till dess reglering. Hybridinstrument ligger i gränslandet mellan skuld och eget kapital vilket innebär att skillnader i beskattning av samma transaktion uppstår mellan olika länder till följd av att avkastning kopplat till instrumenten klassificeras som ränta eller utdelning. Detta resulterar i dubbla avdrag eller avdrag utan inkludering, d.v.s. att avdrag får göras för en och samma utgift i två olika stater samt... (More)
Allt fler gränsöverskridande transaktioner sker i dagens globaliserade samhälle, vilket ökar möjligheten till skattearbitrage. Ett vanligt sätt att utnyttja skillnader i lagstiftning och genomföra skatteplanering på är användandet av hybrida finansiella instrument. Uppsatsen avser att redogöra för dessa instrument och bakgrunden till dess reglering. Hybridinstrument ligger i gränslandet mellan skuld och eget kapital vilket innebär att skillnader i beskattning av samma transaktion uppstår mellan olika länder till följd av att avkastning kopplat till instrumenten klassificeras som ränta eller utdelning. Detta resulterar i dubbla avdrag eller avdrag utan inkludering, d.v.s. att avdrag får göras för en och samma utgift i två olika stater samt då avdrag för en betalning kan göras i en stat utan att motsvarande inkomst tas upp till beskattning i den andra staten. I Sverige saknar ränta eller utdelning skatterättsliga definitioner vilket komplicerar situationen ytterligare.
Till följd av hybrida missmatchningars gränsöverskridande karaktär krävs det en internationell harmonisering av både regler och klassificering kring hybrida finansiella instrument. Det finns olika mellanstatliga alternativ för reglering, grunden för dessa är OECD:s BEPS initiativ som innehåller rekommendationer för hur hybrida missmatchningar bör regleras i nationell rätt. EU:s direktiv mot skatteundandragande och ändringsdirektivet kopplat till detta har fångat upp BEPS rekommendationer och gjort implementeringen av reglerna bindande för EU:s medlemsländer. Till följd av ovanstående presenterade Sverige under 2018 ett förslag på nya skatteregler för företagssektorn. Förslaget innehåller bl.a. ett avdragsförbud för ränta vid vissa gränsöverskridande situationer för företag i intressegemenskap vilket syftar till att förhindra vissa hybrida missmatchningar. Även skatteavtal påverkar utnyttjandet av hybrida finansiella instrument. Under 2017 introducerades ett multilateralt verktyg av OECD som syftar till att lösa eventuella konflikter mellan skatteavtalen och på så sätt förhindra situationer med hybrida missmatchningar. (Less)
Please use this url to cite or link to this publication:
author
Bengtsson, Sofia LU
supervisor
organization
alternative title
Hybrid mismatches in Sweden and the EU - How classification of hybrid financial instruments affect taxation of border crossing transactions
course
JURM02 20181
year
type
H3 - Professional qualifications (4 Years - )
subject
keywords
Skatterätt, EU-rätt, Hybrida missmatchningar
language
Swedish
id
8941152
date added to LUP
2018-06-08 09:42:14
date last changed
2018-06-08 09:42:14
@misc{8941152,
  abstract     = {In a globalized society border-crossing transactions increase in numbers, which also increases the opportunity for tax arbitrage. A common way to exploit differences in regulations and conduct advance tax planning through, is the use of hybrid financial instruments. This essay aims to account for these instruments and how they are regulated. Hybrid instruments are on the border between dept and equity which implies that differences in taxation of the same transaction arise between different nations. This also leads to that the return or payments connected to these instruments classifies as interest or dividend. This results in hybrid mismatches which often are situations with double deductions or with deduction without inclusion, in other words that a deduction is held for the same payment in two countries or that a deduction for a payment is given in one state without that the corresponding income is taxed in the other state. Interest and dividend are lacking definitions in Swedish taxation law which further complicates the situation.
	Following the problems of hybrid mismatches border-crossing character, international harmonization of both regulations and classification concerning hybrid financial instruments is required. There are different interstate alternatives for regulation. The foundation for these are OECD’s BEPS initiative which includes recommendations for how hybrid mismatches should be regulated in national law. The EU anti-tax avoidance directive can be said to have captured the essence of BEPS and made the implementation of these rules binding for the members of the EU. Following the above, the Swedish government during 2018 presented a proposition of new rules of taxation for the business sector. This proposition entails rules for interest deductions in border-crossing situations for associated corporations which aims to prevent some hybrid mismatches. In addition to these regulations, tax treaties affect the use of hybrid financial instruments. During 2017 a multilateral treaty was presented by the OECD which aims to solve conflicts between tax treaties concerning classifications of hybrid instruments and in this way prevent that situations with hybrid mismatches arises.},
  author       = {Bengtsson, Sofia},
  keyword      = {Skatterätt,EU-rätt,Hybrida missmatchningar},
  language     = {swe},
  note         = {Student Paper},
  title        = {Hybrida missmatchningar i Sverige och EU - Hur klassificeringen av finansiella instrument påverkar beskattning av gränsöverskridande transaktioner},
  year         = {2018},
}