Regulation 14 Specification of specified international controlled transaction

Unless an exception in regulation 15 applies, an international controlled transaction^f1 is a specified international controlled transaction where it meets the—

(a)

transfer pricing condition;

(b)

permanent establishment condition and if, for the purpose of applying Chapter 3A^f2 or 4^f3 of Part 2 of CTA 2009 (profits of permanent establishments)—

(i)

it is treated as having occurred between the permanent establishment^f4 and the other parts of the enterprise of which the permanent establishment is a part for the purposes of applying section 21 of CTA 2009^f5 or for the purpose of exemption adjustments made under section 18A of CTA 2009^f6, or

(ii)

the participation condition^f7 is met, or treated as met, in relation to the provision made or imposed by means of that transaction and it is attributable, either wholly or in part, to the—

(aa)

permanent establishment of a non-UK resident company in the United Kingdom, or

(bb)

foreign permanent establishment^f8 of a UK resident company, for the purpose of exemption adjustments made under section 18A of CTA 2009.

Annotations

Footnotes

f1: “International controlled transaction” is defined in section 48(3)(b) Finance Act 2026 (c. 11).
f2: Chapter 3A was inserted by paragraph 4 of Schedule 13 to the Finance Act 2011 (c. 11) and was amended by paragraph 137(2) and (3) of Schedule 16, paragraphs 3, 4, 5(2) to (5), 6 and 7, of Schedule 20 to the Finance Act 2012 (c. 14), section 76(7) of the Finance Act 2016 (c. 24), paragraph 111 of Schedule 1, and paragraph 12 of Schedule 5, to the Finance Act 2019 (c. 1), and paragraph 2(a) and (b) of Schedule 7 to the Finance Act 2026 (c. 11).
f3: Chapter 4 was amended by paragraph 26(3) of Schedule 19 to the Finance Act 2011, section 76(8) of the Finance Act 2016, paragraphs 112(2), (3)(a) and (b), and (4) of Schedule 1, and paragraph 13 of Schedule 5, to the Finance Act 2019, paragraphs 3(a) and (b), 4, 5(2)(a) and (b) and (3)(a) and (b), 6(a) and (b), 7(a) and (b), 8(a) to (h), and 18(2), of Schedule 7 to the Finance Act 2026.
f4: “Permanent establishment” has the meaning given in section 1141 of the CTA 2010, relevantly amended by paragraph 12 of Schedule 7 to the Finance Act 2026 (c. 11).
f5: Section 21 was relevantly amended by paragraph 5(2)(a) and (b) and (3) of Schedule 7 to the Finance Act 2026.
f6: Section 18A was inserted into the CTA 2009 by paragraph 4 of Schedule 13 to the Finance Act 2011 (c. 11) and was relevantly amended by paragraph 3 of Schedule 20 to the Finance Act 2012 (c. 14), section 76(7) of the Finance Act 2016 (c. 24), paragraph 111 to Schedule 1, and paragraph 12 of Schedule 5 to the Finance Act 2019 (c. 1).
f7: “Participation condition” means the condition that is met or treated as met in accordance with sections 148 and 148A of TIOPA 2010 (c. 4), and section 48(4) of the Finance Act 2026.
f8: “Foreign permanent establishment” has the meaning given in Chapter 3A of the CTA 2009.