Corporate Loss Utilisation through Aggressive Tax Planning

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Corporate losses raise compliance risks if aggressive tax planning is used as a means of increasing or accelerating tax relief in ways not intended by the legislator, or to generate artificial losses. This report describes the size of loss carry-forwards, the rules applicable in relation to losses, and identifies the following risk areas: corporate reorganisations, financial instruments and non-arm’s length transfer pricing. After having summarised aggressive tax planning schemes on losses, as well as country detection and response strategies, it offers a number of conclusions and recommendation for tax administration and tax policy officials.





Aggressive Tax Planning is a source of increasing concern for many countries. Numbers at stake are vast, often in the order of billions of dollars. Countries have developed various strategies to deal with aggressive tax planning and international co-operation features prominently among them. Working co-operatively countries can deter, detect and respond to aggressive tax planning in an effective way while at the same time ensuring certainty and predictability for compliant taxpayers.


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