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

Exclusion: banking business

Section 371FD gives HMRC the power to make regulations that can exempt a controlled foreign company's trading finance profits from the CFC charge gateway, where those profits arise from banking business carried on by the CFC.

• HMRC may issue regulations specifying conditions under which the CFC charge gateway (specifically step 3 of the basic rule in section 371FA) does not apply to a CFC's trading finance profits from banking business.
• The exclusion can apply to all banking business or only to particular types of banking business, as specified in the regulations.
• The regulations may take into account where the CFC is resident, where its banking business is regulated, or where it is actually carried on.
• The regulations may also refer to the regulatory requirements that apply to banking business in any territory from time to time.

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