HMRC has made available a revised version of its Statement of Practice (SP 1/01) on the application of the investment manager exemption (IME). One of the key components in the UK’s continuing attraction for non-resident investors (including alternative investment funds) is their ability to appoint UK-based investment managers without creating a risk of UK taxation for themselves. Through a series of qualifying tests, the IME is intended to ensure that overseas investors are not charged to UK tax in relation to investment transactions conducted on their behalf and that any fees received by a UK resident investment manager for services performed for the non-resident are fully chargeable to UK tax. Introduced some 20 years ago, the IME has been a model for investment management tax regimes in other jurisdictions. AIMA has been working for some time with HMRC to have SP1/01 updated in respect of statutory references and to reflect changes such as the removal of the “cliff edge” effect. The revised version should have no substantive changes that would affect UK investment managers. The IME homepage has also been updated with the details of the HMRC contact. For further information, please contact Paul Hale or Enrique Clemente.