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

Elections under section 9A of CTA 2010

Section 371SH deals with how a controlled foreign company (CFC) can be treated as having made a designated currency election — that is, an election to calculate its tax profits in a currency other than sterling — and who is entitled to give the required notice to HMRC.

• A notice can be given to HMRC requesting that a CFC be assumed to have made a designated currency election under section 9A of CTA 2010, provided the CFC would have been eligible to make such an election at the time the notice is given.
• Once a valid notice is given, the CFC is treated as having made the designated currency election, and the normal rules governing how such elections take effect and for how long they last apply accordingly.
• The deemed election can be revoked by giving a further notice to HMRC, provided the revocation is made within the time limits that would have applied had the CFC actually made the original election itself.
• Only UK companies that would bear more than half of the total CFC charge — either individually or jointly with other chargeable companies — are entitled to give the notice or revocation to HMRC.