Designing Effective Controlled Foreign Company Rules, Action 3 - 2015 Final Report
This report sets out recommendations in the form of building blocks for effective
CFC rules. The recommendations are designed to ensure that jurisdictions that choose
to implement them, have rules that effectively prevent taxpayers from shifting income
into foreign subsidiaries. The report sets out the following six building blocks for
the design of effective CFC rules: (1) definition of a CFC, (2) CFC exemptions and
threshold requirements, (3) definition of income, (4) computation of income, (5) attribution
of income, and (6) prevention and elimination of double taxation. Because each country
prioritises policy objectives differently, the recommendations provide flexibility
to implement CFC rules that combat BEPS in a manner consistent with the policy objectives
of the overall tax system and the international legal obligations of the country concerned.
Published on October 05, 2015Also available in: Spanish, French
In series:OECD/G20 Base Erosion and Profit Shifting Projectview more titles