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

Introduction to Chapter

Section 371MA introduces the low profit margin exemption, which is one of the exemptions available to prevent a CFC charge from arising in relation to a controlled foreign company.

• Chapter 13 of Part 9A establishes an exemption known as the "low profit margin exemption"
• This exemption is relevant to the CFC charge provisions set out in Chapter 2 of Part 9A
• Where the exemption applies, the CFC charge gateway test is not met, meaning no UK tax charge arises on the CFC's profits
• The detailed conditions and rules for qualifying for this exemption are contained in the subsequent sections of this Chapter