Selskabsskattelovens §§ 11, 11 B og 11 C Om Tynd Kapitalisering, Renteloftet og EBIT-reglen samt Konsekvenserne heraf for TDC

Torben Foldager

Studenteropgave: Kandidatafhandlinger


This thesis will attempt to describe and analyse the rules in the Danish Corpotate Tax Law about thin capitalization in act 11 and the limitation of deductible interest in act 11 B and finanly the EBIT-rule in section 11 C. The first act was put into to Corporate Tax Law in 1999. At that time it was the act regarding thin Capitalization that was the first to be put into the Corporate Tax Law. At that time the politicians felt that it could prevent big companys in placing the income in a contry with low taxes. The definition of Thin Capitalization is that, a company is considered thin capitalized if the debt is more than four time higher than the total equity. Other than that the section 11 is only apliccable if the company have debt to a related party, and the debt to related parties must be more than DKK 10 mio. The rule in section 11 B was put into the Corporate Tax Law at the same time as the section 11 C. From 2007 the two new rules became a reality because, some of the big Danish companys was bought by private equity funds. These funds were based in countries with low income taxes for companys. To prevent income to leave Denmark and to be put into these funds outside Denmark without paying proper income tax, the new sections in the Corporate Tax Laws became nessacary. Section 11 B regards limitation of deductable interest, which mean that a company can only deduct a certain amount of interest that is calculated by a certain percents of the companys assets. In this section there are no conditions about whether the debt are to related parties or not. Section 11 C regards the EBIT rule, which in short terms means that the EBIT income only can be reduced with a maximum of 80 % due to interest. The purpuse of this thesis is also to look at the conseqences for one of the Danish companys, that have been bought by a foreign equity fund. The Danish company TDC is own by five equity funds through a company in Luxembourg. TDC have been put through a limitation of deductable interest according to the secton 11 B. The economic conseqenses have been calculated to the amount of DKK 523,2 mio for the period starting in 2007 until the end of 2010. This calculation have some uncertencies since the material the calculation is based on, are the yearly financial report. If the calculation of the limitation should be more accurate, it had to be based on the internal financial reports from the company, which specifies the financial statement on a more detailed level. After looking at the conseqences for TDC, the next step in this thesis was to look at different specified areas of the rules to analyze if some part of the rule could be more justified, when you look at it with the companies eyes. One of the most importent areas to look at could be the connection between how a company finances the debt and compare that to the standard interest, that are build into section 11 B. The standard interest is used for calculating how must interest a company can deduct within a year. Since the standard interest is based on convertible bonds on the Danish stock exchange and calculated based on 20 days prior to 15.december, the standard interest is more than a year old, when it is used by the companies. In that time the interest that a company can get when they need to get a loan can be a lot different from the standard interest calculated a year ago. The standard interest calculated at the end of the year will be used for calculation of how much interest a company can deduct the following year. Finally the last purpose with this thesis is to analyze which strategic possibillities the companys in generel and TDC in specific have to avoid the rules, that means that a certain amount of interest cant be deducted. The most interessting topics regardring TDC could be to look at the strategic posibillity to sell of different brands of the company. That could lead to enough finances to reduce the amout of debt in the company, or could be used to be invested in new assets, that could reduce the risk of being put through a limitation of deductable interest.

UddannelserCand.merc.aud Regnskab og Revision, (Kandidatuddannelse) Afsluttende afhandling
Antal sider95