Taxation (International and Other Provisions) Act 2010 section 371DA

Introduction to Chapter 4

Section 371DA introduces Chapter 4, which determines whether any of a controlled foreign company's (CFC's) profits should pass through the CFC charge gateway because UK-based activities have contributed to generating those profits.

• Chapter 4 identifies CFC profits attributable to UK activities by following a series of steps set out in section 371DB, feeding into the CFC charge gateway under section 371BB
• Non-trading finance profits and property business profits are excluded from the CFC's assumed total profits for the purposes of this Chapter
• Key concepts are defined, including significant people functions (SPFs), which are categorised as either UK SPFs or non-UK SPFs depending on where they are carried out, and the CFC group, the OECD Report, and relevant assets and risks
• The Treasury has power to amend this Chapter by regulations to reflect any future OECD documents that replace, update or supplement the 2010 OECD Report on the Attribution of Profits to Permanent Establishments