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

Corporate interest restriction

Section 371SLA sets out how the corporate interest restriction rules are to be applied when calculating the chargeable profits of a controlled foreign company (CFC).

• When calculating a CFC's chargeable profits, the corporate interest restriction rules must be applied with certain modified assumptions
• The CFC is treated as being a member of the worldwide group it would naturally belong to, disregarding any deemed separation caused by the group relief rules in section 371SL
• The CFC is treated as if it were the only UK group company in the relevant period of account
• The de minimis amount (which normally allows a group to deduct a minimum level of interest without restriction) is switched off for CFCs