Double Tax Treaty applications and UK tax repayments

Our client was a major US hedge fund manager running a fund with an extensive portfolio of investments in syndicated loans to UK borrowers.

They initially approached Throgmorton to seek help in recovering tax withheld by UK borrowers.  Interest payments on syndicated loans made by non-UK lenders are subject to withholding in the UK, but in this case were eligible for zero withholding under tax treaties between the UK and the countries in which the hedge fund’s investment vehicles were formed.

Working closely with the client, we analysed their participation in different loans, and determined which participations required applications to HMRC for relief under the applicable treaties. We then prepared and managed a series of refund applications and applications for relief at source, so that future interest payments could be received free of withholding.

To embed this methodology into the client’s business, we worked with the client to develop an information flow and control process for all applications, to ensure prompt and accurate filing of future applications.


Throgmorton: “It is often administrative failure that causes tax and cashflow costs.  Our client was well advised in structuring its funds but did not have the internal resources to control the volume of applications.  We were able to bridge this gap seemlessly”

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