INTM209210 - Controlled Foreign Companies: Computation of Chargeable Profits and Creditable Tax
Unremittable income
ICTA88/SCH24/PARA12
Relief under ICTA88/S584 (relief for unremittable overseas
income) is in principle available to a foreign company in the
computation of its chargeable profits in respect of certain
unremittable income. Entitlement to relief is based on a claim and
the maximum benefit is available under ICTA88/SCH24/PARA4(1) (see
INTM209090). ICTA88/SCH24/PARA12(b) is
now otiose.
The operation of ICTA88/S584 is restricted for the purposes
of Chapter IV. Income qualifies for relief only if it is
unremittable neither -
- to the United Kingdom, nor
- to the overseas company’s territory of residence (see INTM202050).
It follows that income arising in the company’s territory
of residence can never be excluded from chargeable profits
regardless of whether it can be remitted to the United Kingdom.
When the income becomes remittable it must be added back to
the chargeable profits of the overseas company.
