348. Diverted profits tax.

Diverted profits tax ('DPT') is a potentially broad anti-avoidance measure targeting base erosion and profit shifting; it is charged on taxable diverted profits arising to a company in an accounting period1. A charge to DPT is imposed for an accounting period by a designated HMRC officer issuing to the company a charging notice or a supplementary charging notice2. The main rate of DPT is currently 25 per cent of the company's taxable diverted profits3; the DPT rate is deliberately higher than the main rate of corporation tax to discourage profit diversion.

The charge to DPT arises where a United Kingdom