Consortium relief is a modified form of group relief that applies to consortia, which allows for the surrendering of losses between consortium members and the consortium company. This serves to optimize tax efficiency in complex corporate structures.
Income splitting involves distributing income among family members, trusts, or various business entities to potentially benefit from lower tax rates or threshold amounts. This practice is commonly associated with filing joint returns for married couples but can also include giving income property to children or utilizing multiple trusts or business structures.
A tax loophole is an ambiguity or omission in the tax code that allows individuals or corporations to reduce their tax liabilities legally. These loopholes are often the result of complex tax laws and can be used to advantage through strategic financial planning.
Transfer prices refer to the costs at which goods and services are exchanged between divisions or subsidiaries within a conglomerate. They significantly influence the profitability of each division and can serve multiple strategic purposes including motivating managers, evaluating performance, maintaining autonomy, and moving profits.
Transfer pricing involves setting prices for transactions between affiliated entities under common ownership, often used to allocate revenue and expenses among those entities to benefit from tax advantages.
