Is my company a QAHC?
A company is a QAHC if it is resident in the UK and meets a number of conditions.
One of the conditions is that the company must be at least 70% owned by diversely owned funds managed by regulated managers, or certain institutional investors.
Another of the conditions to be eligible to enter the QAHC regime is the main activity of the company is investing its funds with the aim of spreading investment risk and giving investors in the company the benefit of the results of the management of its funds.
Some of the advantages of the regime include, among others:
- An exemption from tax on capital gains on certain shares and overseas property received by the QAHC
- An exemption from tax on overseas property income provided it is subject to tax locally
- An exemption from stamp duty and stamp duty reserve tax on QAHC share buybacks
- Capital gains tax treatment on the premium paid on QAHC share buybacks from individuals
- Disapplying the requirement to levy withholding tax on payments of interest to QAHC investors
- Allowing certain amounts paid to remittance basis users by a QAHC to be treated as non-UK source reflecting the mix of underlying returns from the UK and overseas
- Allowing deductions for certain interest payments that might otherwise be disallowed
There are numerous entry and exit provisions that will need to be considered, including creating a new accounting period on entering or leaving the regime.
It should also be noted that, the small and medium enterprise exemption from transfer pricing will not be available for QAHCs.