2023 Tax Reform - Amendment to CFC Regime

The exemption threshold of effective tax rate applied to Specified CFC will be amened and deferred tax accounting may be afffected from March 2023.

Amendment to exemption threshold in CFC regime and its impact on deferred tax accounting

By virtue of the 2023 tax reform, the exemption threshold of effective tax rate for full-inclusion rules applied to the Specified CFC under the Controlled Foreign Company regime will be reduced to 27 percent from 30 percent.

In this newsletter, we will provide an outline of the amendment and explain the possible impact from the amendment on deferred tax accounting for the fiscal year ending on or after 31 March 2023.

Contents

  1. Amendment to Exemption Threshold of Effective Tax Rate for Full-inclusion Rules Applied to Specified CFC
  2. Impact on Deferred Tax Accounting

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