Income tax implications of Brexit

KPMG reports on the US GAAP income tax accounting implications of the UK’s notice that it will leave the EU. Companies should provide clear and transparent disclosures about the withdrawal process and its potential effects.

Applicability

• A company with UK operations

Relevant dates

• March 29, 2017 – The UK formally notified the European Council of its intention to withdraw from the EU

Key impacts

Public and private companies should consider disclosing the:

• UK’s notice of withdrawal and the nature of the company’s activities that could be affected;
• uncertainty involved in evaluating the effect on financial statements of the loss of tax exemptions and reliefs available to EU members only; and
• expected changes in tax laws or regulations for which there may be a financial statement effect.

Report contents

• Applicability
• Key facts and impacts
• Effect on tax treaties
• Financial reporting implications
• KPMG observation

Related content

• Defining Issues: Year-end disclosure considerations of Brexit