What is a CFC?

• CFC stands for a controlled foreign company. A CFC is not considered an Australian resident for tax purposes.
• If a company or individual is resident in Australia they will have an Australian tax liability regardless of the source of their income. Any company incorporated in Australia will also be subject to Australian taxation. Even if a company is established outside Australia it will be taken to have its residence in Australia if:
  • it carries on business in Australia; and either
  • has its central management and control in Australia; or
  • its voting power is controlled by shareholders who are resident in Australia.
• If you need more specific information about how this classification applies in your situation you can use our free and anonymous Ask a Lawyer service.