Effective for accounting periods beginning on or after 1 April 2015, the Finance Act 2015[1] imposes a levy on company profits—excluding those of small and medium-sized enterprises—that are routed via "contrived arrangements" to tax havens.
[2][3] The arrangements can concern either those that involve entities or transactions lacking economic substance,[4] or efforts by a non-UK company to avoid a UK taxable presence.
[5] Companies that determine that they are subject to the tax have a statutory duty to notify Her Majesty's Revenue and Customs of that fact within three months after the end of the accounting period in question.
[2] The Confederation of British Industry (CBI) described the effort to impose taxation on diverted profits as "a real concern for global business".
[8] Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants (ACCA), said, "It's a bit like reporting yourself to the police and then having to defend yourself.