HMRC has published draft guidance for consultation, to support draft legislation in Finance Bill 2012 that applies to Controlled Foreign Companies (CFC) and permanent establishments.

By way of reminder, Finance Bill 2012 contains the draft legislation for the new CFC rules, the biggest reform of this legislation for some time which has been the subject of consultation over a number of years. The UK Government intend that the amended rules will make the UK more competitive. The Bill also contains amendments to the rules for the exemption of foreign permanent establishments that will apply to CFCs and permanent establishments, for accounting periods beginning on or after 1 January 2013.

HMRC advise that to accompany the legislation they will publish draft guidance split into separate documents for each chapter of Schedule 20 of Finance Bill 2012. The draft guidance will be published in stages over the summer. HMRC is consulting on the draft guidance throughout the rest of 2012.

The first few chapters of the guidance is available at http://www.hmrc.gov.uk/drafts/cfc.htm