US Supreme Court confirms creditability of UK tax in PPL

May 2013


On May 20, 2013, the US Supreme Court issued its decision in PPL Corp., et al v. Commissioner. The Court held that taxpayers could claim a US foreign tax credit for the UK windfall tax. The Court's unanimous decision resolves a split over the creditability of the windfall tax after decisions in the Third Circuit Court of Appeals in PPL (holding for the government), and the Fifth Circuit Court of Appeals in Entergy Corp. v. Commissioner (holding for the taxpayer).

Although PPL applies to a very narrow set of taxpayers, the decision may help some US taxpayers conclude that a particular foreign tax is creditable.

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