Corporation Tax: Setting Up In The UK

The responsibility for correctly calculating the UK corporation tax liability falls on business directors, irrespective of whether they are based in the UK or overseas. 

Corporation tax is an amount that limited companies must pay to HMRC on all taxable trading profits. It could be referred to as income tax. It is also known as a CT600. It is set at a flat rate of 19% for most UK company’s. All limited companies and non-profit organisations that are trading in the UK must pay corporation tax on all forms of taxable income. 

“The tax credit system in the UK is far superior to the Australian system and is much more dare I say understanding and/or forgiving. For example, we recently reopened a client’s 2018 corporate tax return. They had commissioned a third party to produce an R&D report and that third party had charged them a percentage of their refund. We found a few errors in it so we revised up their claim and £25,000 is currently being returned to them. £25,000 to start any sort of business off in the UK is obviously phenomenal, that’s someone’s salary but the client was very happy. We charged her an hourly rate for that and didn’t charge a percentage. 

A UK company tax return is typically made up of a number of items: 

  • Form CT600 which must be signed by an authorised signatory; director, company secretary or authorised tax representative 
  • The Company accounts, known as statutory accounts. These are the accounts the company must prepare for its members under the Companies Act, including directors’ reports and, if applicable, auditor’s reports 
  • Separate computations and/or calculations showing how figures on the CT600 have produced 
  • Supplementary pages to the CT600 where required. 

Companies can also benefit from the Enterprise Investment Scheme (EIS) and/or  Seed Enterprise Investment Scheme (SEIS), which aims to boost investment in smallstart-upsby offering income tax relief on the shares bought through crowdfunding websites.If companies have this certificate then you can promote this on certain crowdfunding websites which makes you more attractive for local investment in the UK. Paul mentions, “there are websites such as Crowd Key, for example, where you take a look at the website, it’ll have different companies it’s funding, how long the funding run is going for and it will specify whether they are SEIS or EIS compliant. 

We can help to minimise corporate tax exposure and relieve the administrative burden of compliance with the current tax legislation. Please do  get in touch to discuss in more detail.

Indonesia Targets Taxation of Tech Companies to Boost Economy

Indonesia is set to tax tech companies that may or may not have a legal presence in the country, as electronic transactions and the use of streaming services and online telecom apps have increased notably during the COVID-19 pandemic.

The legal basis for this measure is the recently enacted emergency bill Government Regulation in Lieu of Law No. 1 of 2020 regarding State Financial Policy and Financial System Stability for the Management of the Coronavirus or COVID-19 Pandemic and/or in Facing Threats to the National Economy and/or Financial System Stability (“GR 1/2020”).

Collection of VAT

Article 6 of GR 1/2020 states that the government will collect value-added tax (“VAT”) for intangible taxable goods and/or taxable services from outside Indonesia which are utilized in the country through electronic system trade activities, in accordance with Law No. 8 of 1983 regarding Value-Added Tax for Goods and Services and Sales Tax on Luxury Goods, as lastly amended by Law No. 42 of 2009. This VAT will be collected, deposited and reported by foreign traders, foreign service providers, foreign electronic trading system providers and/or domestic electronic trading system providers appointed by the Minister of Finance. These parties can appoint representatives domiciled in Indonesia to collect, deposit and report the VAT.

Procedures for the appointment of representatives and for the collection, deposit and reporting of the VAT are further regulated under Minister of Finance Regulation No. 48/PMK.03/2020 regarding Procedures for the Appointment of Collectors and for the Collection, Deposit and Reporting of VAT for the Use Inside the Customs Area of Intangible Taxable Goods and/or Taxable Services from Outside the Customs Area through Electronic System Trade Activities (“MOF Reg. 48/2020”).

Collection of Income Tax

The government will also collect income tax from foreign traders, foreign service providers and/or foreign electronic trading system providers that have a significant economic presence in Indonesia. The determination of “significant economic presence” is based on the consolidated gross turnover of the business group, sales in Indonesia, and number of active users on digital media in Indonesia. The threshold for these criteria are to be further regulated in a Minister of Finance regulation. A party that meets the threshold for a significant economic presence in Indonesia will be treated as a permanent establishment and subject to income tax.

If foreign traders, foreign service providers or foreign electronic trading system providers are determined to have a significant economic presence in Indonesia but cannot be treated as permanent establishments due to the application of agreements with other governments in the context of avoiding double taxation and the prevention of tax evasion, they will be subject to an electronic transaction tax.

Such income tax or electronic transaction tax is to be paid and reported by the foreign traders, foreign service providers and foreign electronic trading system providers. Similar to the VAT payment, parties are allowed to appoint representatives domiciled in Indonesia to fulfil their income tax or electronic transaction tax obligations.

The rate for the income tax or electronic transaction tax, its calculation, the procedures for tax payment and reporting, and the procedures for the appointment of representatives to fulfil tax obligations are to be further regulated by Minister of Finance regulation.


Foreign companies that do not comply with the above provisions are subject to administrative sanctions and could also have access to their apps blocked by the Minister of Communication and Informatics.

As the government implements large-scale social distancing restrictions and businesses apply work from home policies, the number of users of streaming services and online meeting apps has increased markedly.

The government has for years been aiming to collect taxes from foreign tech companies that enjoy significant revenue from Indonesia, but to no avail. It has been a struggle because of these companies’ lack of a physical presence in Indonesia, with prevailing tax regulations only covering companies domiciled in the country or those that can be considered permanent establishments.

This is a loophole in the era of the cross-border digital economy that GR 1/2020 tries to address. As noted by Indonesian Finance Minister Sri Mulyani Indrawati, under the new regulation a permanent establishment would no longer be defined solely on physical presence. Consequently, even if foreign tech companies do not open an office in Indonesia, they would still have tax obligations if they established a significant economic presence in the country.

For example, it has been reported that, pursuant to MOF Regulation 48/2020, the government will impose a 10% tax on subscription fees for streaming apps starting July 1, 2020.

Status of GR 1/2020 

It appears that these efforts to tax foreign tech companies will continue after the COVID-19 pandemic ends. Pursuant to Law No. 12 of 2011 regarding the Formulation of Laws and Regulations, as amended by Law No. 15 of 2019, an emergency bill must be submitted to the House of Representatives for approval. If it is approved by the House it will then become a law, and if it is rejected, the emergency bill will be revoked.

In this regard, the House has approved the adoption of GR 1/2020 as a law, resulting in the promulgation of Law No. 2 of 2020 regarding Stipulation of GR 1/2020 regarding State Financial Policy and Financial System Stability for the Management of the Coronavirus or COVID-19 Pandemic and/or in Facing Threats to the National Economy and/or Financial System Stability, This new law is effective as of May 18, 2020. (May 20, 2020)

This publication is intended for informational purposes only and does not constitute legal advice. Any reliance on the material contained herein is at the user’s own risk. You should contact a lawyer in your jurisdiction if you require legal advice. All SSEK publications are copyrighted and may not be reproduced without the express written consent of SSEK.

COVID-19 in Vietnam: Travel Updates and Restrictions

In light of the recent COVID-19 outbreak, Vietnam has imposed several travel restrictions on those entering the country. As of May 19, Vietnam had confirmed 324 cases of COVID-19, though 263 of the patients had recovered.

Those planning to travel to Vietnam should be aware of the latest restrictions currently in place:

  • Vietnam has suspended the entry of all foreigners from March 22 until further notice to limit the spread of COVID-19. The measure will not apply to diplomats, officials, foreign investors, experts, and skilled workers as per Prime Minister Nguyen Xuan Phuc.
  • Vietnam’s Immigration Department on May 18 announced automatic visa extensions until June 30 for foreigners that entered the country on visa waiver programmes, e-visas, or tourist visas since March 1.
  • Foreigners that entered the country before March 1 including those with temporary residence permits will also be entitled to extensions till June 30 but must present proof of documents such as health declarations and official documents from embassies. For assistance, applicants can all the immigration helpline at 0243.9387320.
  • Travelers that are still in Vietnam can call the Tourist Helpline at +84378173371 for guidance on visas, accommodation, hospitals, embassy, or consulate details. The helpline is available from Monday to Friday from 9:00 a.m. to 5:30 p.m. local time.
  • Vietnam lifted social isolation measures on April 23 with most businesses resuming operations. Nevertheless, measures such as wearing face masks and observing strict hygiene standards remain in place.
  • As of 12:00 pm on March 15, Vietnam suspended all visas and will deny entry to travelers from the UK and the 26 Schengen countries; this includes travelers that have visited or transited through these countries in the past 14 days. This will be effective for 30 days.
  • In addition, Vietnam has suspended visa on arrival for all foreign nationals except for those on official or diplomatic trips. Those who currently hold visas to enter Vietnam will need to undergo screenings and may be quarantined when entering the country.
  • From March 7, all travelers coming to Vietnam will be required to submit a health declaration upon arrival. Passengers can fill out this declaration at the airport or submit it online via this link (picture below).
  • Those that are assessed to have symptoms of the epidemic will be transferred to designated health facilities for isolation.
  • There is a temporary ban on travelers with travel history to mainland China, except for those on official or diplomatic missions.
  • We have also heard of travelers in more remote border crossings into Vietnam being denied entry if they possess any China visa history in their passport. If travel is required, we recommend using the main border entry-exit points.
  • Do not travel if you are sick; those that travel while sick, risk being quarantined, and undergo tests.
  • Visa-free travel has been suspended for South Korean and Italian nationals as well as ethnic Vietnamese from these countries. In addition, travelers arriving from or those that have transited through Daegu and Gyeongsangbuk in South Korea in the past 14 days will be denied entry.
  • In addition, visa-free travel has also been suspended for eight countries: Denmark, Finland, France, Germany, Norway, Spain, Sweden, and the UK from March 9.
  • Travelers from China that are permitted to enter Vietnam, as well as those from South Korea, Iran, and Italy, are required to undergo a 14-day quarantine upon entry.
  • Flights and passenger trains, as well as various border crossings to mainland China, remain suspended.
  • All Vietnam carriers have suspended flights to South Korea, while other foreign airlines have reduced the number of flights significantly between Vietnam and South Korea.
  • Flights to Hong Kong, Taiwan, and Macao remain operational though they are operating with reduced capacity.
  • Additional restrictions are possible for travelers when they return to their country of origin, including entry restrictions and quarantine.

The Vietnamese government officially declared COVID-19 as an epidemic on February 1, with authorities taking swift and strict measures to contain the virus.

These include measures such as the suspension of schools, the cancelation of festivals, and tourist activities nationwide. In addition, bars, clubs, and movie theatres have also been closed in Hanoi and Ho Chi Minh City until March 31.

In addition, several Vietnamese businesses, residential complexes, and restaurants have installed their own preventative measures to keep customers safe.

Due to the epidemic, travelers should monitor restrictions and comply with advisories issued by the local and national authorities.

The Vietnamese Ministry of Health is updating about the epidemic here, while the Tourism Ministry has also listed travel updates here.

In addition, basic precautions one can take to reduce their risk to the coronavirus as advised by the World Health Organization (WHO) are:

  • Wash hands with soap and water or an alcohol-based hand rub;
  • Cover nose and mouth with tissues or inside of elbow when coughing or sneezing;
  • Avoid close contact with anyone with cold or flu-like symptoms;
  • Thoroughly cook meat and eggs; and
  • Avoid unprotected contact with live wild or farm animals.

This article is produced by Vietnam Briefing, a premium source of information for investors looking to set up and conduct business in Vietnam. The site is a publishing arm of Dezan Shira & Associates, a leading foreign investment consultancy in Asia with over 27 years of experience assisting businesses with market entry, site selection, legal, tax, accounting, HR and payroll services throughout the region.

Andersen Global Pushes Ahead With West Africa Expansion

Andersen Global’s international expansion has continued unabated despite the COVID-19 pandemic, with the tax and legal giant adding another West African firm to its global network.

The firm has formed a tie-up with Chinguity Law in the northwest African country of Mauritania. Andersen Global now has a presence in 28 African countries.

Insolvency and Bankruptcy Laws – Extension of timelines

In view of the pandemic COVID-19 and the changing business environment due to COVID-19, the Insolvency and Bankruptcy Board of India (“IBBI”) has issued certain notifications to address various concerns of stakeholders in connection to Insolvency and Bankruptcy Code, 2016 (“Code”) and other regulations framed therewith.
The gist of some of the latest notifications issued by the IBBI are set out below:
1. The Insolvency and Bankruptcy Board of India (Insolvency Resolution Process for Corporate Persons) Regulations, 2016 (“CIRP Regulations”), provides that the corporate insolvency resolution process is a time bound process and it is required to be concluded by the insolvency professional in a prescribed period of 330 days including litigation period. The IBBI has amended the CIRP Regulations by inserting a new special provision which states that the period of lockdown imposed by the Central Government due to outbreak of pandemic COVID-19 will not be counted for the purposes of the time-line for any activity that could not be completed due to such lockdown in relation to a corporate insolvency resolution process.
2. The Insolvency and Bankruptcy Board of India (Liquidation Process) Regulations, 2016 (“Liquidation Regulations”), the liquidation process is mandatorily required to be completed by the liquidator in a prescribed period of 365 days. Due to spread of COVID-19 and declaration of lockdown by the Central Government, the IBBI has amended the Liquidation Regulations by inserting new regulation which states that the period of lockdown imposed by the Central Government due to outbreak of pandemic COVID-19 will not be counted for the purposes of the time-line for any task that could not be completed due to such lockdown in relation to any liquidation process.
3. In addition to above, IBBI has also issued notification amending the Model Bye-Laws and Governing Board of Insolvency Professional Agencies (Amendment) Regulations, 2020 whereby it has given certain relaxations on time lines and its rules for authorisation of assignment by Insolvency Professional Agencies to their professional members.
The above relaxations in timelines are evidence that the regulators are mindful of the difficulties and delay in compliances owing to COVID-19. The Government of India and the regulators are constantly making efforts to ensure that corporates and professionals have fair liberties to comply with the timelines and regulations.
This news flash has been written for the general interest of our clients and professional colleagues and is subject to change. This news flash is not to be construed as any form of solicitation. It is not intended to be exhaustive or a substitute for legal advice. We cannot assume legal liability for any errors or omissions. Specific advice must be sought before taking any action pursuant to this news flash.


For further clarification and details on the above, you may write to Mr. Vaishakh Kapadia (Partner) at, Mr. Ankit Parekh (Senior Associate) at and Mr. Vinit Shah (Associate) at

COVID-19 – Insurance Coverage

In times of crisis, individuals and corporations rightly turn to their insurance policies in the expectation of alleviating current and future loss. When doing so, they discover, for the first time, the policies’ exclusions, named perils, deductibles, self-insured retentions, specific and aggregate limits (and sub-limits) of coverage. On March 23, 2020, Swiss Re, the world’s largest reinsurer by market capitalization, announced a $250 million exposure to any cancellation of the Tokyo Olympics. The International Olympic Commission (IOC) is said to have an event cover that exceeds $800 million. A cover of this size was likely manuscripted by a fleet of insurance professionals who scrutinized everything down to the last comma in the last sentence of the policy. The IOC likely knows what it purchased and when and to what extent it will be reimbursed in the event of postponement or cancelation.

Most commercial lines policies, however, are issued on non-negotiated forms. Corporate policyholders have only a vague understanding of their policies’ mechanics coupled with unrealistically high expectations of coverage. This confusion typically results in wasteful litigation and sometimes judicially created a cover that insurers never intended to provide. An insurance company’s understanding of its policies and confidence in its ultimate limited exposure, will not deter what will likely be tens of thousands of lawsuits filed by individuals and businesses seeking reimbursement for the incomparable loss that is likely to result from COVID-19.

Property Insurance (business interruption) 

Currently, more than 18 states have state-wide stay at home orders and many of the nation’s largest cities are similarly closed for business. Naturally, many small business operators will remember (or be reminded) that their “business owner’s policy” may have business interruption (BI) coverage. Large corporations will have business interruption and perhaps even contingent business interruption (CBI) coverage, included in their commercial property policy. Most commercial property insurance policies provide coverage for business income loss by adding an endorsement to the insured’s property policy. Typically, such an endorsement protects the insured for losses of business income sustained as a result of direct loss, damage, or destruction to insured property by a covered peril. This type of policy would seemingly not respond to loss resulting from COVID-19. Similarly, CBI covers an insured’s business income loss resulting from loss, damage, or destruction of property owned by others, including direct “suppliers” of goods and services to the insured or direct “receivers” of goods or services manufactured or provided by the insured. The property damage to these suppliers or receivers must be of a type that would be covered by the insured’s policy had the damage happened to the insured’s property.

The current pandemic seemingly has caused no “physical” property damage, except perhaps contamination. Undoubtedly, insureds will argue that the physical contamination of the property prevents its use and is therefore covered loss. Additionally, certain businesses, including large manufacturers, have shuttered entire operations due to a single employee found to be infected by the virus. Insureds will likely draw on case law citing gas, ammonia and other air-borne hazards, as well as asbestos, and claim, by analogy, that the mere presence of COVID-19 in a structure satisfies the “direct physical loss of or damage to” requirement. At least one such case has already been filed in state court in Napa, California: French Laundry Partners LP et al. v. Hartford Fire Insurance Co. et al. (March 25, 2020).

Certain specialized insurance policies as well as endorsements to standard commercial property policies, including those used for the hospitality and healthcare industries, expressly provide insurance coverage for losses caused by “communicable or infectious diseases” without requiring physical damage to insured property. These policies and endorsements will each have their triggers, exclusions, and limits that will need to be carefully reviewed. Conversely, in 2006, the Insurance Services Office (ISO) promulgated a “virus” exclusion that is found in many commercial property policies that, if included in a policy, would seem to bring the question of coverage to an end. But, almost certainly, it will not. Those exclusions likely will be read extremely narrowly and subject to all manner of parsing. Ironically, the absence of an ISO exclusion in a commercial property policy may well be used by many insureds to claim that their policies provide “silent” COVID-19 coverage.

Some commercial property insurance policies provide coverage for business interrupted when a “civil authority” prohibits or impairs access to the policyholder’s premises. For the average policyholder, such a provision might seem uniquely suited to the current situation. It probably is not. Depending upon the specific wording, a policy’s “civil authority” coverage may or may not require that the access restriction result from “physical loss” by a covered cause of loss. These provisions typically cover instances where a Fire Department or Housing Authority, for example, condemn a building, prevent access due to hazards, or otherwise find the premises unsafe for habitation or occupation. Accordingly, federal, state, or local governmental authorities limiting access to or from businesses merely to prevent the active transmission of an infectious disease would seemingly not be encompassed by these provisions.

Liability Insurance (CGL, D&O)

Insurance companies’ exposure to third-party liability in the wake of COVID-19 will be manifold. We only touch on two of these exposures.

Cruise ships, amusement parks, movie theaters, and concert venues could all face claims by infected guests alleging that the operator failed to exercise reasonable care in protecting against the risk of exposure to coronavirus. Commercial general liability (CGL) policies, intended to protect businesses against third-party claims for bodily injury resulting from exposure to harmful conditions, often have both defense and indemnity provisions. The defense coverage in CGL policies is often triggered despite the tenuousness of the claims.

In addition to third-party claims brought against businesses, a company’s directors and officers may be subjected to shareholder lawsuits alleging that their wrongful acts (or inaction) in response to COVID-19 caused the company economic loss. A company’s Directors and Officers (D&O) policy may provide indemnity and defense from these shareholder lawsuits. Shareholders may contend that management failed to (i) develop adequate contingency plans, (ii) failed to observe protocols recommended or required by governmental authorities, or (iii) failed to properly disclose the risks COVID-19 posed to the company’s business and financial performance, generally. The majority of D&O policies exclude claims for bodily injury when afforded a “strict and narrow construction,” as they must be under the laws of most states. The “absolute” bodily injury exclusion found in most D&O policies, which excludes coverage for any claim “based on, directly or indirectly arising out of,” or relating to actual or alleged bodily injury, may permit insurers to deny coverage for shareholder claims with any connection to COVID-19. Nevertheless, such a shareholder class action has already been filed in the United District Court for the Southern District of Florida, Douglas v. Norwegian Cruise Lines et al. (March 12, 2020).

Workers Compensation and Disability Income Insurance 

There will likely be a hardening market in the wake of COVID-19 for workers’ compensation (WC) and disability income insurance. Most state workers’ compensation statutes provide that an employee is entitled to benefits for “occupational disease.” The “ordinary diseases of life” that the wider public is generally exposed to are generally excluded from WC insurance programs unless the employee can establish a direct causal connection to the workplace. Coronavirus is transmitted primarily person-to-person and seemingly would constitute “ordinary disease,” but likely not a workplace injury. Employees of hospitals, cruise ships, delivery services, and other occupations, however, who have worked throughout the spread of COVID-19 may be able to draw the necessary causal connection.

Insurers of disability income insurance will see an increase in claims worldwide. Those who contract COVID-19, exhaust the elimination period, and remain disabled, will be entitled to disability benefits. Not enough is known about the general recovery period for COVID-19 to predict the cost to the insurance industry for disabled employees. Anecdotally, the virus would appear to quickly overtake those with compromised immune systems, lead to relatively quick recovery for most of the people, and have a lasting respiratory injury for a smaller segment of the population. It is conceivable that the increased number of disability claims and length of time out of work could trigger specific and aggregate excess of loss reinsurance for certain disability carriers.


Clark Hill will continue to monitor and report on developments by regulators, lawmakers, and courts that may affect the insurance industry. Clark Hill’s Insurance & Reinsurance Group, consisting of more than 40 lawyers in 25 offices across the United States, is prepared to bring its regulatory, contract wording, and litigation experience to assist insurers, reinsurers, and intermediaries in identifying enterprise risk, offering defense in jurisdictions across the United States, and negotiating with state and federal regulators.

Article by David W. Centner (Clark Hill PLC)

Coronavirus (Covid-19), French continuing plans and economy

On 13 March 2020, French Ministry of Justice issued a press release just after the announcements of the President of the French Republic. The aim, due to the emergency, is to protect citizens who are the most vulnerable and to curb the epidemic. Chancery has now prepared continuing plans to allow Justice to face core obligations of the Nation.

According to a CNB (Conseil National des Barreaux) release dated 15 March 2020, the continuing plans will be triggered as from 16 March 2020 by the Ministry of Justice to avoid propagation of Covid-19. Tribunal and courts will be closed, except for cases relating to core litigations.

Core litigations are limited to (i) criminal tribunals and courts including (a) pre-trial custody (détention provisoire) and probation (contrôle judiciaire), (b) immediate criminal summary trials (comparution immédiate), (c) appearance before the liberty and custody judge (juge des libertés et de la détention), (d) appearance before the enforcement judge (juge de l’application des peines) including appeals, these latest in the events of emergency only, (e) permanence of public prosecutor’s office (permanence du parquet), (f) hearings relating to investigation chamber for custody (audience de la chambre d’instruction pour la détention) and (ii) civil tribunals and courts including (a) children’s courts and permanence in the events of emergency only (audiences du tribunal pour enfants et du juge pour enfants et permanence du tribunal pour enfants) – including educational assistance (assistance educative), (b) summary judgments (including relating to family matters), but based on emergency only, (c) civil liberties and custody judge hearings (juge des libertés et de la détention civil).

Due to the risks of contamination, instructions are, to the extent possible, to cancel criminal court sessions related to crimes (cour d’assises). It is also allowed to postpone hearings (taking into account reasonable time extension and pre-trial custody time-frame).

Legal public facilities (services d’accueil du public) will be closed as well as justice centers and legal access points. Even if justice civil servants will not be allowed to receive public, they will be reachable by phone to address emergency situations.

As far as Paris is concerned, the first President of the court of appeal of Paris issued an ordinance dated 16 March 2020 (N°105/2020) named ordonnance de roulement modificative (amending rotation ordinance), on the basis of, inter alia, the decision of the Ministry of justice dated 15 March 2020 triggering continuing plans, article L1142-7 of the French Code de la Défense and emergency. Such article not only states that (i) the Ministry of Justice ensures in all circumstances the continuity of the legal criminal services as well as enforcement of criminal sanctions, but also (ii) he participates in fighting against elements adversely affecting fundamental interests of the Nation (this including preservation of the population in and outside France, according to article 410-1 of the French Code pénal).

Aside to the public authorities, the legal profession, as a whole, may support the economy : it can be suggested that business lawyers may wish to consider advising their clients to enter into settlement agreements (within the meaning of article 2044 of the French Civil Code) to solve pending litigations and to unlock commercial situations created by the current sanitary crisis.

This would give the economy a possibility to maintain a flow of activity.

Up to date 16 March 2020

Ashurst launches Business Consulting Service

Ashurst has launched Ashurst Consulting, a new business line providing specialist consulting services as an additional offering to its existing legal services. The new line will initially be offered in Australia.

Ashurst Consulting aims to provide holistic solutions that help clients comply with regulatory and legal frameworks in their jurisdictions and operationalize laws and regulations.

“[The new offering] will strengthen our ability to effectively manage clients’ most critical business challenges, by bringing together the technical expertise and rigour required to create value by meeting a broader spectrum of their needs,” said Paul Jenkins, Ashurst’s global managing partner .

Aside from Ashurst Consulting, the firm has launched two adjacent services: Board Advisory and Risk Advisory.

Effect On Real Estate Projects: COVID-19

Authors, Maureen Z. Ralte, Associate Partner and Gajanand Kinodiwal, Associate

The Real Estate industry is one of the major sectors that contribute to the overall Gross Domestic Product (GDP) of our country. According to the KPMG report titled ‘Indian Real Estate and Construction: Consolidating for growth’ presented by the National Real Estate Development Council (NAREDCO) and Asia Pacific Real Estate Association (APREA), read with CIRIL’s Half Yearly Round Off 2019 report, the Indian real estate sector is expected to contribute 13 percent to the country’s GDP by 20251.

However, since the onset of the Novel Coronavirus or ‘COVID-19’, there has been a cascading effect on the economy including the real estate sector.2

Read more here

Serbia: Economic measures in the private sector

The Government of Serbia adopted on April 10, the set of financial measures aimed at mitigating the negative economic impact of COVID – 19 pandemic and support of the private sector businesses, with an immediate effect. The most important measures include:

– State Subsidies to private sector – which includes all Serbian legal entities and entrepreneurs as well as representative and branch offices of foreign legal entities;
– Financial Program – which is aimed at providing loan facilities to private sector for the purpose of acquiring working capital and preserving their financial liquidity and which operate in the production, service, trade and agriculture sectors.


1.1. Qualifications criteria

– Companies which decreased the number of employees for more than 10% in the period from March 15 until April 10 (not counting definite term employments which are concluded before March 15 and expire prior to April 10) are not eligible. Users of economic measures shall lose this right in the event of decreasing the number of employees for more than 10% until October 31, 2020 compared to the number of employees on March 15, 2020 (not counting definite term employments which are concluded before March 15 and expire prior to October 31, 2020).
– Entrepreneurs who temporarily ceased their business activity earliest as of March 15 are eligible subject to fulfilling the above employment level maintenance criteria.
– Private sector businesses established and duly registered after March 15 are not eligible.
– Banks, insurance companies, voluntary pension funds, financial leasing companies, payment institutions and electronic money institutions when classified as large enterprises are barred.
– Opting for the use of economic support measures rules out the possibility to pay dividends until the end of 2020, otherwise the right for subsidies is lost.

Note: It is unclear whether, besides reduction of workforce based on redundancy (preventing redundancy was obviously one of the Government’s primary reasons for introducing subsidies), other manners of terminating employment for more than 10% employees in relevant period (e.g. termination due to breach of working duties, failure to achieve appropriate working results or even consensual termination of employment) would also make the employer ineligible for subsidies. As long as there are no official clarifications in this respect, we would advise the employers to apply extra caution whenever terminating an employee for whatever reason, in period from March 15, 2020 to October 31, 2020, in order to avoid losing rights to subsidies.

1.2. Types of subsidies

Fiscal benefits:

Fiscal policy measures comprise in deferral of maturity and payment dates for specified tax obligations of private sector, which are normally due in the period from April 1 to June 30, 2020, as follows:

(i) suspension of employment tax and social contributions for March, April and May 2020 until January 4, 2021 and repayment in 24 installments, free of interest.
(ii) suspension of corporate income tax advance payments for March, April and May 2020, normally due on April 15, May 15 and June 15 until submission of final corporate income tax return for 2020, i.e. until 30 June 2021 (except when the when fiscal year differs from calendar year). Repayment is allowed in 24 installments, free of interest.
(iii) analogue application of above tax deferral to entrepreneurs who keep accounting records.
(iv) suspension of advance payment of taxes and social contributions for March, April and May 2020, until January 4, 2021 for tax flat rate entrepreneurs (“paušalci”) and repayment in 24 installments, free of interest.

In the event employment taxes and social contributions for March are already paid, the taxpayer may use tax deferral benefit for April, May and June 2020.

This fiscal benefit is used by the taxpayer, upon its own discretion, and it is performed by filing monthly tax return (PPP-PD) for employment taxes and social contributions by entering January 4, 2021 as payment date for the month when support measure is used. Finance Ministry is expected to provide further instructions clarifying technical aspects linked to use of this benefit.

Direct cash subsidies

Direct cash subsidies are provided exclusively for the pay out of salaries and are payable to specially designated bank account opened with commercial banks. This measure is different for micro, small, medium sized enterprises (“MSMEs”) and large enterprises. Classification of businesses for this purpose is done on the basis of 2018 financial reports while all companies incorporated in 2019 and 2020 are considered as small enterprises.

(i) MSMEs, entrepreneurs, farmers are entitled, per each full time employee, to cash subsidies corresponding to minimum wage in March 2020 (app. EUR 260) payable in May, June and July 2020 while taking account of reported number of full time employees in PPP PD form for March, April and May.
(ii) Large enterprises are entitled to cash subsidies corresponding to 50% of minimum wage in March 2020 (app. EUR 130). Subsidies are payable per full time employee referred to paid leave either based on employer’s decision due to temporary interruption or decline in business or administrative decision brought due to disease (Articles 116 or 117 of Labor Law). As for MSMEs, payment of subsidies is envisaged in May, June and July 2020 based on the same principle.

In respect to part time employees, subsidies are payable in proportion to the time spent at work and reported in the PPP-PD tax return.

VAT exemption for donations

During the state of emergency, all traffic of goods and services free of charge, provided to the Ministry of Health, Republic Health Insurance Fund and other public health institutions is exempted from VAT. The Decree has retroactive application and takes account of transactions effected as of March 15. VAT taxpayers are required to keep special records which include identification data of the party receiving donation and value of goods and services.

Cash incentive for Serbian Citizens

Upon lifting of the state of emergency, one-time cash support in the amount of EUR 100 in Serbian dinar countervalue shall be paid to each adult citizen of the Republic of Serbia.

1.3. Procedure and deadlines

Businesses decide upon their own discretion whether or not to use available measures. Entities which decide to take benefits may opt for a 1 to 3-months period by filing adequate PPP PD return in April, May or June. For instance, entities wishing to use measures for a 3-month period should file PPP PD latest on April 30, 2020.

The subsidies are to be paid on the employer’s special bank accounts opened for this purpose. All employers having bank accounts in more than one bank need to notify the Tax Authority on-line until 25 April at the latest, in which bank the special purpose account shall be opened.


Financial Program is aimed at providing loan facilities to entrepreneurs, cooperatives and MSMEs for the purpose of acquiring working capital and preserving their financial liquidity and which operate in the production, service, trade and agriculture sectors.

The program is realized through the Development Fund of the Republic of Serbia which is accepting applications latest until December 10, 2020 and subject to availability of funds. Decisions of the Fund ought to be made by December 31, 2020 while the final deadline for realization of approved funds is March 31, 2021.

The following terms and conditions apply for the loans:
– Maintenance of employment level in line with the report of the Central Registry for Social Insurance on number of definte and indefinite term employees as of March 16, 2020. Difference of maximum 10% at the moment of applying for funds and during the loan period is tolerated.
– Loan duration of maximum 36 months including up to 12 months grace period and up to 24 months repayment period.
– 1% interest rate
– Loans are granted and repaid in local currency in monthly installments.
– Minimum amount of loan:
o RSD 1,000,000 (app. EUR 8,547) for companies, and
o RSD 200,000 (app. EUR 1,709) for entrepreneurs, cooperatives and business entities registered with relevant registries.
– Maximum amount of loan:
o RSD 10,000,000 (app. EUR 85,470) for entrepreneurs and micro enterprises,
o RSD 40,000,000 (app. EUR 341,880) for small enterprises, and
o RSD 120,000,000 (app. EUR 1,025,641) for medium enterprises.
– Collaterals are determined depending on the value of the loan.
– Applicant must not be subject to bankruptcy, liquidation, reorganization or restructuring measures.


NKO Partners