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HMRC internal manual

International Manual

HM Revenue & Customs
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Controlled Foreign Companies: The CFC charge gateway chapter 7 - captive insurance business: interaction with transfer pricing

Where a CFC has transactions with a UK connected person, that person when making their SA return must ensure the return reflects the arm’s length price of the transactions (where the person is subject to Part 4 TIOPA). While this is the case for any CFC, not just a captive insurance CFC, where you are considering an examination of a captive insurance CFC you should also consider whether a transfer pricing review should be carried out at the same time. Transfer pricing applies to the pricing of a contract of insurance with a UK connected company and to a contract of insurance with a UK resident who has bought goods or services from a UK company connected with the CFC (see INTM421040).