Tax Updates: March 14th, 2022

Consistent with our commitment to provide updated information on current tax issues, we outline below the main provisions of the newly introduced Circular E.2018/2022 in relation to Controlled Foreign Companies.

In this edition (Download the PDF, 0.22 MB)

—     Conditions for application of the provisions

• Definition of Controlled Foreign Companies

Α. The participation requirement

B. The requirement that Corporate Income Tax is actually paid

C. Income requirement

—     Definition of “related” companies

—     Income categories

—     Calculation of CFC’s taxable income

—     Distribution of profits by the CFC and sale of participation in the CFC

—     Tax return of Individuals

—     Cases where the provisions of article 66 ITC do not apply

• Companies with substantial economic activity
• Shipping companies