Part 13Tax avoidance
C1C2Chapter 2Transfer of assets abroad
Pt. 13 Ch. 2 applied (with effect in accordance with art. 1(2)(3) Sch. 1 of the amending S.I.) by The Offshore Funds (Tax) Regulations 2009 (S.I. 2009/3001), regs. 1(1), 21
Charge where power to enjoy income
725Reduction in amount charged where controlled foreign company involved
F11
This section applies if—
a
under Part 9A of TIOPA 2010 (controlled foreign companies), the CFC charge is charged in relation to a CFC's accounting period,
F6b
an amount of income is treated as arising to an individual under section 721 for a tax year, and
c
the income mentioned in section 721(2) is or includes a sum forming part of the CFC's chargeable profits for that accounting period.
2
The amount of income so treated is reduced by—
where—
S is the sum forming part of the F2CFC's chargeable profits for that accounting period,
CA is the F3CFC's chargeable profits for that accounting period so far as apportioned to chargeable companies at step 3 in section 371BC(1) of TIOPA 2010, and
CP is the F2CFC's chargeable profits for that accounting period.
F52A
In a case in which section 724 applies, the reference to S in the formula in subsection (2) is to be read as a reference to X% of S.
2B
“X%” is determined as follows—
where—
A is the amount on which the individual is liable as determined under section 724(2), and
I is the amount of the income mentioned in section 721(2).
F43
Terms used in this section which are defined in Part 9A of TIOPA 2010 have the same meaning as in that Part.
Pt. 13 Ch. 2 applied by 1988 c. 1, s. 762ZA (as inserted (21.7.2008 with effect in accordance with Sch. 7 para. 98 of the amending Act) by Finance Act 2008 (c. 9), Sch. 7 para. 94)