Controlled foreign company (CFC) disclosure is now electronic only

Section 61 of the Tax Administration Act 1994 requires taxpayers with interests in controlled foreign companies (to disclose those interests to the Commissioner:

“Where any person has at any time in an income year an income interest or a control interest in a foreign company or an attributing interest in a foreign investment fund, that person shall disclose to the Commissioner, in the prescribed form and within the time allowed by section 37 for providing the person’s return of income for the relevant tax year.”

With the change in the international tax rules to incorporate an active business test, the prescribed form also changed as outlined in the 2011 International tax disclosure exemption ITR22.

“Disclosure of all interests in a controlled foreign company is required using a Controlled foreign companies disclosure (IR458) form. This form, which involves uploading a prescribed spreadsheet, can cater for up to 500 individual disclosures.”

Please note that the IR458 form must be completed online, and electronic filing is a mandatory requirement for CFC disclosure now.

August 1st, 2011