The Controlled Foreign Company Regime - An Essential Guide

Introduction

The UK has had a controlled foreign company (CFC) regime since 1984, with the current rules having been introduced in 2012.

In light of global awareness of tax avoidance schemes, such rules are becoming more commonplace. In 2013 the OECD BEPS initiative recommended that CFC rules should form part of the tax rules for countries generally.

Following the OECD’s recommendation, the Anti-Tax Avoidance Directive (ATAD) was implemented prescribing changes to CFC rules. The Finance Act 2019 introduces amendments to the UK CFC rules in order to comply with ATAD.

This introductory level course considers the purpose of CFC rules and examines the UK CFC legislation in particular, highlighting points that need to be considered during cross-border corporate transactions.

What You Will Learn

This course will cover the following:

• What is the purpose of CFC regimes?
• What is a CFC?
• Control test
• Legal control/economic rights/accounting
• Exemptions
• CFC Charge gateways
• Initial gateway
• Main gateways
• Profits arising from UK activities
• Non-trading finance profits
• Trading finance profits
• Captive insurance profits
• Solo consolidation waiver profits
• The CFC charge
• State Aid