ADIT Study Plan - ADITextra by Extratax Training

With little over 7 weeks to go to the June exams, what is your ADIT study plan? If you don’t have one or haven’t been sticking to it, now is the time to re-focus and decide how you’ll go about achieving your ADIT goal.

Each week in ADITextrathe blog for ADIT candidates – we discuss the topics covered in our online ADIT courses and share free video content. Follow along with Principles of International Tax, Transfer Pricing, UK & US Tax as a guide for your ADIT study plan. 

Read on to find out about the topics covered in this week’s online classes. To mark the launch of our distance learning course, the spotlight is on UK Tax and you can watch a discussion on International Financing. If you missed any earlier editions of ADITextra, you’ll find them here.

 

1. Transfer Pricing

The transfer pricing class returned on Tuesday after a fortnight’s break. Well, we say break, but the students had been studying and sitting their first mock exam. With the limited time remaining before Thursday 10 June, you should be getting in the swing of attempting past paper questions. Here’s some great advice that James (Jimmy) Ryan gave his transfer students this week as he set a past paper for the weekly assignment:

 

As a minimum, I would like you at attempt question 8….but in truth, I would really like you to spend time, under exam time constraints, to answer more than 1 question. The time spent now attempting questions, putting yourself under pressure to answer these question under time constraints will expose you to what you are comfortable with and, more importantly, what you are not. You will learn much more quickly and effectively by submitting an answer that you are not happy with as you will be annoyed with yourself for not including some parts and it will be seared into your minds for the big day in June!

 

At this stage, the course has almost covered the full transfer pricing syllabus, with this week’s class looking at:

  • Transfer pricing documentation:

    • Local File

    • Master File

    • Country by Country Reporting

  • Safe Harbours

  • Dispute Resolution

    • Corresponding Adjustments

    • Mutual Agreement Procedure (MAP)

    • Arbitration

    • Advanced Pricing Agreements (APA)

 

Don’t forget to include these compliance areas in your ADIT study plan!

 

If you would like to express your interest in joining us for the December 2021 Transfer Pricing course, please use the contact form below or email info@extrataxtraining.com. We’ll shortly be launching the December 2021 courses with an attractive early bird booking offer!

 

2. Principles of International Tax

The Principles of International Taxation class also returned after an Easter break. Jimmy is spending this week & next on Transfer Pricing, an important area of the Module 1 syllabus. As you would probably guess, it’s one of his favourite topics and his enthusiasm for the subject shines through!

 

Transfer pricing is new to some of our Principles of International Tax students, so Jimmy’s ability to explain the foundations is invaluable. If you missed it, check out his video on the Fundamentals of Transfer Pricing on our YouTube channel.

 

This week’s class covered:

  • Introduction to Transfer Pricing

  • Article 9 of the OECD Model Tax Convention

  • OECD Transfer Pricing Guidelines

  • Advanced Pricing Agreements (APA)

  • Transfer Pricing Case Law, including:

    • DSG Retail v HMRC

    • GE Capital Canada v The Queen

    • SNF v Commissioner of Taxation

    • State Aid cases

 

When preparing your ADIT study plan, think about any tax cases that you will be expected to know. For some papers, the syllabus lists specific cases. However, for Principles of International Tax, the guidance on cases is more general:

 

The syllabus does not examine the rules of any one state. Decisions of the courts of many countries are therefore relevant to this subject. Leading cases are drawn from as far afield as New Zealand, South Africa, Canada, France and Germany.

Cases from the non-English speaking world are generally from the Bundesfinanzhof (German Federal Tax Court), the Conseil d’Etat (French Supreme Administrative Court) or the Hoge Raad (Netherlands Supreme Court). The more important cases are summarised in European Taxation or the Bulletin for International Taxation.

 

If you’re undertaking self-study, this puts the onus on you to compile a list of relevant cases and learn about them. Remember to keep up-to-date, as you’re expected to have knowledge of any court case reported up to six months before the exam. Plus there can be additional credit available for knowledge of more recent developments. A great way of staying updated is to sign up for the International Tax newsletter from MNE Tax.

 

If you are interested in joining us for the December 2021 course for Principles of International Taxation, please use the contact form below or email info@extrataxtraining.com. In early May, we will launch the December 2021 courses with an attractive early bird booking offer!

 

 

3. UK Tax

On Thursday, the UK Tax class looked at the final Corporate Tax topics on the syllabus, under the heading of ‘International Financing’. See the Spotlight section below to learn more.

 

Now that all the Corporate Tax topics have been covered, the students can throw themselves into practising past paper questions. Many of the exam questions cover more than one part of the syllabus, so it’s important to understand how the various pieces of legislation interact and – we can’t stress this enough – attempt questions under exam conditions.

 

ADIT UK Tax – Online Distance Learning Course

Interested in benefitting from our UK Tax expertise? Then sign up for our new online distance learning course, with introductory pricing available!

 

The online distance learning course for Module 2.09 includes:

  • Tutor support from Catriona – contact her directly from an app in the study materials

  • Mock exam with tailored feedback

 

 

4. US Tax

It is already Week 6 of our US Taxation course, with Ishali Patel returning on Thursday to discuss:

  • Foreign investment in US real property interests

  • The OECD and US Model tax treaties

  • Limitations of benefits provisions

  • Provisions relating to hybrid entities

 

The Limitation of Benefits (LOB) clause in US tax treaties is a challenge to understand. If you’re not familiar with it, give yourself enough time in your ADIT study plan to get to grips with it.

We’re very excited to announce that Robert Misey is joining us as a guest lecturer on the US Tax course later this semester. Robert is a US tax attorney focusing on international taxation, M&A structures, transfer pricing strategies, and inbound and outbound planning for multinationals. He’s also an author of an essential reading book from the syllabus – Schadewald, M. and Misey, R. ‘Practical Guide to US Taxation of International Transactions’.

 

If you would like to express your interest in joining us for the next ADIT US Tax exam sitting for Module 2.10 in June 2022, please use the contact form below or email info@extrataxtraining.com.

 

5. Spotlight on International Financing

Each week, we put the spotlight on a topic covered in one of our classes and offer you free ADIT content. This time, let’s look at UK provisions relating to International Financing.

 

If you get an exam question involving loans or other financing transactions, you should be thinking about the following areas of the UK syllabus:

  • Transfer pricing / thin capitalisation
  • Unallowable purpose under s441 & s442 CTA 2009
  • Reporting requirements for international movements of capital
  • Late paid interest
  • Corporate Interest Restriction (CIR)
  • Hybrid mismatch – although this legislation is wider than financing costs, and applies to any payments meeting the conditions.

 

You should check out the judgment in the Blackrock case for a discussion on transfer pricing of loans and unallowable purpose.

 

When looking at the Corporate Interest Restriction, remember that it is a mechanical test, working through a series of calculations. The main challenge in understanding it can be getting past the long list of acronyms used in the legislation & HMRC guidance. Don’t let them confuse you or put you off – ignore most of the names & focus on the principles. Take your time to work through the key steps, practising lots of questions of course!

 

Watch & Learn

Watch part of this week’s UK Tax course for an overview of  ‘International Financing‘.

 

Follow us on social media to keep up to date with our ADIT blogs. And don’t be shy, please say hello and let us welcome you to our ADIT community!

 

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