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Exemption for active business

Last updated 26 May 2005

The active business exemption exempts you from taxation under the FIF measures for interests you have in foreign companies principally engaged in certain active businesses, known as eligible activities. [section 497]

This exemption also applies:

  • when working out the net income of a trust estate where the trust invests directly in a foreign company engaged in an active business, or
  • when working out the FIF income of a CFC or a CFT - because the income of a CFC or CFT is worked out as though they were a resident taxpayer.

This exemption does not apply to an interest in a non-resident trust.

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