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EX 14: Attribution: 10% threshold, not PIE
or “Income from foreign companies if you own 10% or more and are not a portfolio investment entity”
You could also call this:

“Calculating income interest in foreign companies includes associated people's interests”

When you’re looking at the 10% threshold in certain sections of the law, you need to consider more than just your own income interest in a CFC. You also have to add in the income interests of people associated with you for that accounting period. This means your total income interest might be bigger than you first thought.

However, there’s an exception to this rule. If the person associated with you is itself a CFC, you don’t need to include their income interest in your calculations.

A CFC is a type of foreign company, but you don’t need to worry about the details of what it means right now. The important thing to remember is that when you’re checking if you meet the 10% threshold, you might need to count more than just your own income interest.

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Next up: EX 16: Income interests for certain purposes

or “How your ownership in foreign companies affects your tax obligations”
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Part E Timing and quantifying rules
Controlled foreign company and foreign investment fund rules: Ten percent threshold and variations in income interest level

EX 15Associates and 10% threshold

  1. For the purpose of applying the 10% threshold in sections CD 45, CQ 2, EX 14, EX 21, EX 34, and EX 58, a person's income interest in a CFC is increased by each income interest in the CFC, for the relevant accounting period, of a person associated with the person.

  2. Despite subsection (1), the income interest of an associate is not counted if the associate is a CFC.

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Notes
  • Section EX 15(1): substituted, on , by section 383 of the Taxation (Business Taxation and Remedial Matters) Act 2007 (2007 No 109).
  • Section EX 15(1): amended (with effect on 30 June 2009), on , by section 152(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).
  • Section EX 15(1): amended (with effect on 1 April 2008), on , by section 152(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).