F1PART 9AControlled foreign companies
C1Chapter 11The excluded territories exemption
Pt. 9A Chs. 11-14 applied (with modifications) by 2009 c. 4, s. 18I-18ID (as substituted (with effect in accordance with Sch. 20 para. 55(2) of the amending Act) by Finance Act 2012 (c. 14), Sch. 20 para. 6)
371KGCategory B income
1
A CFC's category B income for an accounting period consists of any notional interest which—
a
is deducted from any of the CFC's relevant income for tax purposes under the law of the CFC's territory or any territory in which the CFC has a permanent establishment, but
b
is not deducted in determining the CFC's assumed taxable total profits for the accounting period.
2
But the CFC's category B income is not to exceed its relevant non-local income.
3
“Notional interest” means an amount representing a notional interest expense or other financing charge calculated by reference to any of the CFC's equity or debt.
4
“Relevant income” has the same meaning as in section 371KE.
5
“Relevant non-local income” means the gross amount (that is, the amount before deduction of expenses or transfers to or from reserves) of any non-trading income—
a
which is included in the CFC's relevant income, and
b
which is received (directly or indirectly) from—
i
a person resident outside the CFC's territory, or
ii
a permanent establishment which a person resident in the CFC's territory (apart from the CFC itself) has in a territory outside the CFC's territory.
Pt. 9A inserted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 20 para. 1 (with ss. 56-58)