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Have changes to the UK’s CFC rules created thousands of ‘surprise’ CFCs?

Speed read
The apparent policy intention of the amendment to the controlled foreign companies (CFCs) ‘control’ test, which came into effect on 1 January 2019, was to bring the UK rules into compliance with Council Directive (EU) 2016/1164, also known as the EU Anti-Tax Avoidance Directive (ATAD). However, the actual amendment seems to go much further than is required by ATAD: it appears that many more companies fall within the definition of a CFC than would have fallen within the pre January 2019 UK rules combined with the basic ATAD ‘control’ rules – a potentially unpalatable and unexpected outcome for taxpayers, advisers and compliance firms alike.
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