We understand that HMRC has now started writing to taxpayers, who claimed the benefit of the finance company exemption in the CFC rules before 1 January 2019, requesting them to complete a self assessment of the significant people functions (SPF) relating to the finance company concerned to enable HMRC to collect the amounts determined as unlawful state aid.
This follows letters sent by HMRC in December 2019 which outlined how the UK intends to recover the State aid pursuant to the European Commission's decision in April 2019 that the exemption was not justified under State aid rules where financing income from a foreign group company channeled through an offshore subsidiary derives from UK activities.
The UK’s current CFC regime (introduced in January 2013) was amended in 2018 to comply with the EU anti-tax avoidance directive with effect from 1 January 2019.
We understand that HMRC has now started writing to taxpayers, who claimed the benefit of the finance company exemption in the CFC rules before 1 January 2019, requesting them to complete a self assessment of the significant people functions (SPF) relating to the finance company concerned to enable HMRC to collect the amounts determined as unlawful state aid.
This follows letters sent by HMRC in December 2019 which outlined how the UK intends to recover the State aid pursuant to the European Commission's decision in April 2019 that the exemption was not justified under State aid rules where financing income from a foreign group company channeled through an offshore subsidiary derives from UK activities.
The UK’s current CFC regime (introduced in January 2013) was amended in 2018 to comply with the EU anti-tax avoidance directive with effect from 1 January 2019.
