The CFC regime imposes a UK tax charge on the UK resident controllers in respect of the profits of certain controlled foreign companies (CFCs). The regime described here is the CFC regime applying for accounting periods of CFCs starting on or after 1 January 2013. The regime that applied to accounting periods of CFCs starting before 1 January 2013 is explained in: Old CFC rules—overview [Archived].
The current regime operates in a similar way to the old in that it imposes a charge to tax on the UK resident controllers of a non-UK resident company. However, the structure of the regime has a number of different elements, mainly focused on ensuring that the charge only captures profits of CFCs that have been artificially diverted from the UK and providing exemptions for certain types of finance profits.
A CFC is a company that is:
resident outside the UK, and
controlled by persons resident in the UK
See Practice Notes: CFC rules—definition of legal, economic
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