Securitisation entities
The new interest limitation rules may significantly impact the tax position of Section 110 companies (S.110) which generally make returns to investors by way of interest on a Profit Participating Note (PPN). A S.110 whose shares are held by a charitable trust (Orphan S.110 structures) may not meet the definition of a standalone entity as they may be considered associated with the trust. However, it is possible the “single entity worldwide group” provision included in the rules will provide some measure of relief to such entities.
