CFC rules—assumed taxable total profits and assumed total profits

Copyright © 2025 LexisNexis

Published by a LexisNexis Tax expert

Practice notes

CFC rules—assumed taxable total profits and assumed total profits

Copyright © 2025 LexisNexis

Published by a LexisNexis Tax expert

Practice notes

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This Practice Note deals with the controlled foreign company (CFC) Rules that apply for Accounting periods of CFCs commencing on or after 1 January 2013.

For a Practice Note on similar subjects under the rules that applied until then, see Practice Note: Old CFC rules—chargeable Profits [Archived].

The differences between the old and new rules are explained in this Practice Note.

The terms:

•
assumed taxable total profits, and
•
assumed total profits

are used throughout the CFC rules, most importantly feeding into the calculation of the CFC charge itself. Understanding their meaning is, therefore, vital to be able to apply the CFC rules properly.

Meaning of assumed taxable total profits

The assumed taxable total profits of a CFC for an accounting period are the amounts that would be the CFC's 'taxable total profits' for corporation tax purposes, applying the corporation tax assumptions (which are a series of assumptions required to be made in making the calculations, including, most importantly, that the CFC is a UK resident company) to the CFC.

Taxable

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Jurisdiction(s):

United Kingdom

Key definition:

Rules definition

What does Rules mean?

The detailed provisions of a pension scheme.

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