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HMRC internal manual

International Manual

Controlled Foreign Companies: The CFC charge gateway chapter 9 - exemptions for profits from qualifying loan relationships: scope of the rules: chapter 9 and double taxation relief

For TIOPA10/Part 9A/Chapter 9 purposes double tax relief will be proportionate to the profits that are subject to tax in the UK in accordance with Chapter 16.

In the link to the example diagram below, the CFC has NFTPs of £50m. A claim under Chapter 9 is made, exempting 75% of the NTFPs. The CFC pays tax of £2.5m in its territory of residence; a quarter of that tax, £0.63m is creditable tax that is taken into account in calculating the CFC charge at step 5 of section 371BC (1).

Use this link to see example diagram