Interest deductibility limits – the updates you’ve been waiting for

Finance releases draft legislation for new excessive interest and financing expense limitation (EIFEL) regime.

On February 4, 2022, the Department of Finance released for public comment draft legislative proposals and accompanying explanatory notes to implement the new earnings-stripping rule that will limit the amount of interest and financing expenses that businesses may deduct for income tax purposes based on a proportion of earnings. These measures were first introduced in the 2021 federal budget consistent with the recommendations in Action 4 Report of the OECD’s BEPS Action Plan.

We invite you to join us as we discuss the new EIFEL regime and share various related scenarios and perspectives.