F1PART 9AControlled foreign companies
Chapter 3The CFC charge gateway: determining which (if any) of Chapters 4 to 8 applies
371CEDoes Chapter 6 apply?
1
Subject to what follows, Chapter 6 (trading finance profits) applies for a CFC's accounting period if (and only if)—
a
the CFC has trading finance profits, and
b
at any time during the accounting period, the CFC has funds or other assets which derive (directly or indirectly) from UK connected capital contributions.
2
The CFC's trading finance profits are to be treated for the purposes of this Part as if they were non-trading finance profits (and, accordingly, Chapter 6 cannot apply for the accounting period) if—
a
the CFC is a group treasury company in the accounting period, and
b
a notice is given to an officer of Revenue and Customs requesting that the CFC's trading finance profits be treated as if they were non-trading finance profits.
3
Profits treated as non-trading finance profits under subsection (2) are not to be taken to fall within section 371CB(3) or (4).
F24
The CFC is a “group treasury company” in the accounting period if, assuming the relevant period were the accounting period—
a
the CFC would be a group treasury company in the relevant period in accordance with section 316(2) (group treasury companies), and
b
throughout the relevant period, the requirements of section 316(3)(a) and (b) would be met in relation to the CFC as a group treasury company.
5
For the purpose of applying section 316 in accordance with subsection (4)—
a
section 316(2) applies with the omission of paragraph (d), and
b
section 337(1) (definition of “the worldwide group”) applies with the omission of paragraph (a).
6
A notice under subsection (2)(b)—
a
may be given only by a company or companies determined under subsection (7) or (8), and
b
must be given—
i
within 20 months after the end of the accounting period, or
ii
within such longer period as an officer of Revenue and Customs may allow.
7
A company may give a notice if—
a
the company would be a chargeable company were section 371BC (charging the CFC charge) to apply in relation to the accounting period, and
b
the percentage of the CFC's chargeable profits which would be apportioned to the company at step 3 in section 371BC(1) would represent more than half of X%.
8
Two or more companies may together give a notice if—
a
the companies would all be chargeable companies were section 371BC (charging the CFC charge) to apply in relation to the accounting period, and
b
the percentage of the CFC's chargeable profits which would be apportioned to the companies, taken together, at step 3 in section 371BC(1) would represent more than half of X%.
9
In subsections (7) and (8) “X%” means the total percentage of the CFC's chargeable profits which would be apportioned to chargeable companies at step 3 in section 371BC(1) were section 371BC (charging the CFC charge) to apply in relation to the accounting period.
Pt. 9A inserted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 20 para. 1 (with ss. 56-58)