Anti - Avoidance

Tax avoidance and abuse of law prevention has become a global standard supported by the national governments and international organizations. 

Many of the countries from the former soviet territories have been upgrading their anti-avoidance mechanisms in line with the global standard by introducing and elaborating concepts such as “beneficial ownership test”, “principal purpose test” and “general anti-avoidance rules”. These concepts are gaining significant court practice and attention of both taxpayers and taxmen alike. The trend is clear - control over the right for tax and treaty benefits is getting tighter, attacks by tax authorities are rising in number and their claims become more focused and tend to be successful. Whereas the criteria to be applied by the national tax administrations to fight unjust tax benefits and misuse of tax treaties are still somewhat vague, the intention is well defined and should be respected. Evaluating the risks and working out the sustainable and tax-compliant strategy is important. 

MP Part supports our clients by providing advisory services in the field of international tax planning and in particular related to the various anti-avoidance measures implemented locally or internationally. We assist with:

  • understanding of the established anti-avoidance concepts and mechanism;
  • consideration of facts and circumstances in view of applicable anti-avoidance rules;
  • documentation of the “beneficial ownership” over the cross-border income, functions performed, and the risks borne;
  • transaction planning in view of the “principal economic purpose”.