Asset Holding Companies (AHCs)


HM Treasury and HM Revenue & Customs are considering the introduction of a tax regime for UK-based Asset Holding Companies (AHCs) within broader collective investment structures.  Two consultations on this matter have been conducted.  AIMA and the ACC remain in contact with HMT and HMRC to ensure the vehicle is conceptualised most optimally. 

Current work: 

In September 2021, the ACC, AIMA and the British Private Equity & Venture Capital Association (BVCA) have submitted a joint letter to HM Treasury providing combined feedback on the proposed Asset Holding Companies (AHC) regime. The letter highlights concerns with the development of the AHC regime based on our current understanding of the Government’s intentions.

The letter outlines  key points pertaining to:

  • Ownership;
  • Qualifying activities;
  • Avoiding turning capital into income;
  • Risk of turning income into capital;
  • Remittance issues;
  • WHT and stamp duty;
  • Distributions;
  • Treaty access; and
  • Senior Accounting Officer regime.

The ACC and AIMA have previously provided comments to support HM Treasury’s consideration of this new regime.  In our response, the ACC and AIMA emphasised that the AHC regime would be attractive to many alternative investment managers if the vehicle meets the following interlinked criteria:

  • Preserve the principle of tax neutrality for underlying investors in private investment funds;
  • Be simple for funds, managers, and investors to access the regime;
  • Align wherever possible with existing practices and processes;
  • Be competitive with existing AHC structuring options available to alternative investment managers in Luxembourg and Ireland but idealy represent an advance on these; and
  • Be compatible with developing OECD standards.

Previously, the ACC, AIMA and the Managed Funds Association (MFA) submitted a joint response  to the first stage consultation on the role of Asset Holding Companies (AHC) as part of the broader review of the UK funds regime. 

Upcoming actions: 

HMT and HMRC have released an initial tranche of draft legislation in July 2021 and a second tranche in Autumn 2021. 

(Last updated: 28 September 2021)