Revenue eBrief No. 027/21

12 February 2021

Controlled Foreign Company Rules - Finance Act 2020 amendments

Tax and Duty Manual Part 35b-01-01 has been updated to reflect amendments to Controlled Foreign Company (CFC) rules that were introduced by Finance Act 2020.

A new section 835YA in Part 35B of the Taxes Consolidation Act 1997 provides that section 835T (effective tax rate exemption), section 835U (low profit margin exemption) and section 835V (low accounting profit exemption) will not apply for an accounting period of a CFC where that CFC is resident in a jurisdiction which is listed in Annex 1 of the EU list of non-cooperative jurisdictions for tax purposes.

The amendments take effect in respect of accounting periods of CFCs beginning on or after 1 January 2021.