HMRC issues supplementary guidance on CFC finance company exemption

The controlled foreign companies (CFC) rules include a special break enabling UK multinational groups to put in place tax efficient financing structures, known as the finance company exemption.   Under the ‘partial’ finance company regime, only 25% of the profits of...

CFC group finance company exemptions – guidance on new anti-avoidance provision

F(No.2)B 2014 cl 286 inserts an anti avoidance provision into TIOPA s 371IH to counter arrangements made after 4 December 2013 exploiting the complete or partial exemption from CFC apportionment for group finance companies.   HMRC have issued guidance on the...

CFC finance company exemption changes to prevent profit shifting

Two changes to the CFC rules in the Finance Bill 2014 will prevent profit shifting to exploit the finance company exemption. If a UK company currently has an existing loan to a non-UK group company the temptation is to transfer...

CFC and offshore financing exemption – interaction with unallowable purpose rule

The new CFC rules in Part 9A TIOPA allow groups to establish (or in some cases retain) tax efficient offshore financing arrangements under the finance company exemptions (Chapter 9). Provided the detailed conditions in are met, the CFC charge on...