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

Exclusion: trading profits (export of goods condition)

Section 371DK sets out the export of goods condition, which is one of the tests a controlled foreign company (CFC) can meet to have its trading profits excluded from the CFC charge gateway.

• The export of goods condition is one of several tests relevant to excluding a CFC's trading profits from a UK tax charge.
• The condition is met if no more than 20% of the CFC's total trading income comes from goods exported from the UK.
• Goods exported from the UK to the territory where the CFC is resident are excluded from this 20% calculation.
• The purpose of the exclusion is to ensure that only CFCs with significant UK export-related trading activity are brought within the CFC charge.