SCHEDULES

SCHEDULE 20Controlled foreign companies and foreign permanent establishments

PART 3Other amendments

CTA 2010

37

CTA 2010 is amended as follows.

38

In section 398D (restriction on use of losses) for subsection (6) substitute—

“(6)

Subsection (6A) applies if A is a CFC within the meaning of Part 9A of TIOPA 2010 and the CFC charge is charged in relation to the accounting period ending with the relevant day.

(6A)

No sum may be set off under section 371UD of TIOPA 2010 against the sum charged on a chargeable company so far as the sum charged is attributable to the CFC's chargeable profits so far as, in turn, attributable to the carrying on of the relevant activity.”

39

(1)

Section 938M (group mismatch schemes: controlled foreign companies) is amended as follows.

(2)

In subsection (1) for the words from the beginning to “company” substitute “ Section 371SL(1) of TIOPA 2010 (assumption that a CFC ”.

(3)

In subsection (2)—

(a)

for “chargeable profits” substitute “ assumed taxable total profits ”, and

(b)

for “Chapter 4 of Part 17 of ICTA” substitute “ Part 9A of TIOPA 2010 ”.

40

In section 1139 (definition of “tax advantage”) in subsection (2) —

(a)

omit the “or” after paragraph (d), and

(b)

after paragraph (d) insert—

“(da)

the avoidance or reduction of a charge or assessment to a charge under Part 9A of TIOPA 2010 (controlled foreign companies), or”.