Last week the “Financial Times ” ran a story that the UK tax authorities (HM Revenue & Customs) were looking to tackle the disguising of employment relationships through limited liability partnership structures and the manipulation of profit and loss allocations to achieve tax advantages.
The Table Below Shows 15 of the largest 25 hedge fund groups in the world. It includes all those hedge fund groups in the top 25 that have an entity registered with the UK’s financial regulator the FCA. 10 of the 15 hedge fund groups have a “corporate partner” listed amongst the owners of the businesses on the Financial Services Register.
Not to say that each of the hedge fund firms in the table with a corporate partner has been either disguising employment relationships or manipulating their UK P&L, but these are the largest global firms of the type HMRC will look at. Note that there are American firms with larger UK businesses than some of those listed – for example Moore Capital is much bigger in London staff terms than Paulson & Co, but the ranking is by total group AUM.
Footnotes: The top 25 hedge fund firms with no entity registered with the FCA are Bridgewater Associates, Baupost Group, and Adage Capital Management. For clarity a number of the largest hedge fund firms with London offices have been excluded from the table as they do not appear to have a corporate partner. Those excluded firms are: Standard Life Investments, Och-Ziff Capital Management Group, MAN Group/GLG Partners, BlackRock, Winton, and Renaissance Technologies. Farallon Capital Management and Canyon Capital Advisors are included in the Table specifically to illustrate that not all American firms optimise their corporate structure in Europe to minimise tax. To a degree M&G (and JPM/Highbridge) are included in the Table for the same reason. E&OE.