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

Recovery of sum charged from other UK resident companies

Section 371UF allows HMRC to recover unpaid CFC charges from other UK resident companies that hold or have held an interest in the same controlled foreign company as the company that has defaulted on its CFC charge.

• Where a company fails to pay its CFC charge by the due date, HMRC may serve a notice of liability on another UK resident company that holds or has held (directly or indirectly) the same interest in the CFC
• The company receiving the notice becomes liable for the unpaid charge (or a corresponding proportion), any unpaid interest at the date of the notice, and any interest accruing afterwards on the amount it owes
• If the company receiving the notice does not pay in full within three months, the outstanding amount may also be recovered from the original defaulting company
• HMRC's right to recover from the company that received the notice is not affected by any recovery action taken against the original defaulting company