Henderson not alone in mulling tax move
Henderson Global Investors is not the only asset manager to have looked at relocating from the UK for tax reasons, according to financial analysts and bankers. The company confirmed this morning it is considering a move to the Republic of Ireland, and said it would give more details tomorrow.
Henderson, one of London's largest listed asset management groups, is believed to have considered the move following the end of a period of deferment of certain tax losses.
These deferments allowed it to pay a tax-rate of just 11.7% last year, according to its annual report, and it expects to pay only 10% to 15% this year, well below the full UK corporation tax rate of 28%.
However, at the time of its report Roger Yates, chief executive, warned investors that from 2009 Henderson was likely to revert to paying "closer to the statutory rate."
Henderson is not the only company to have considered a move, even despite the UK Chancellor's move to reduce corporation tax from 30% to the current rate, which took effect this April.
Others to have mulled it include Aberdeen Asset Management, which is based in Scotland. It has since decided against a move away from the UK, however.
One investment banker said: "Any service business based in different international locations is in a good position to take this kind of action.”
Many fund managers have incorporated themselves in offshore locations for the same reasons. Fidelity International, with large offices in London, is incorporated in Bermuda because of its advantageous tax rates, while John Templeton's Templeton, Galbraith & Hansberger was incorporated in the Bahamas prior to its acquisition by Franklin Resources in 1992.
Henderson reports its first-half results tomorrow morning.
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