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

What are "designer rate tax provisions"?

Section 371ND defines "designer rate tax provisions" — a concept used in step 2 of the controlled foreign company tax exemption rules under section 371NB.

• "Designer rate tax provisions" are foreign tax rules that appear designed to let companies exercise significant control over how much tax they pay.
• Such provisions must be formally specified in regulations made by the HMRC Commissioners before they are treated as designer rate provisions.
• The regulations can distinguish between different cases or different territories, allowing a tailored approach.
• The concept is relevant to determining whether a CFC qualifies for the tax exemption under the basic rule in section 371NB.