Law

Corporation Tax Act 2009

United Kingdom · statute

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In force since 2026-04-01, as the publisher states.

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Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.

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Contents: 1,891 provisions
  1. Title and introductory text
  2. A1 Overview of the Corporation Tax Acts
  3. 1 Overview of Act
  4. 2 Charge to corporation tax
  5. 3 Exclusion of charge to income tax
  6. 4 Exclusion of charge to capital gains tax
  7. 5 Territorial scope of charge
  8. 5A Arrangements for avoiding tax
  9. 5B Trade of dealing in or developing UK land
  10. 6 Profits accruing in fiduciary or representative capacity
  11. 7 Profits accruing under trusts
  12. 8 How tax is charged and assessed
  13. 9 Beginning of accounting period
  14. 10 End of accounting period
  15. 11 Companies with more than one accounting date
  16. 12 Companies being wound up
  17. 13 Overview of Chapter
  18. 14 Companies incorporated in the United Kingdom
  19. 15 Continuation of residence established under common law
  20. 16 SEs which transfer registered office to the United Kingdom
  21. 17 SCEs which transfer registered office to the United Kingdom
  22. 18 Companies treated as non-UK resident under double taxation arrangements
  23. 18A Exemption for profits or losses of foreign permanent establishments
  24. 18B Chargeable gains etc
  25. 18C Capital allowances etc
  26. 18CA Income arising from immovable property
  27. 18CB Profits and losses from investment business
  28. 18D Payments subject to deduction
  29. 18E Employee share acquisitions
  30. 18F Effect of election
  31. 18G Anti-diversion rule
  32. 18H What are “diverted profits”?
  33. 18HA Modification of Chapter 3 of Part 9A of TIOPA 2010
  34. 18HB Modification of Chapter 4 of Part 9A of TIOPA 2010
  35. 18HC Modification of Chapter 5 of Part 9A of TIOPA 2010
  36. 18HD Modification of Chapter 7 of Part 9A of TIOPA 2010
  37. 18HE Modification of Chapter 9 of Part 9A of TIOPA 2010
  38. 18I Exemptions from anti-diversion rule
  39. 18IA The excluded territories exemption
  40. 18IB The low profits exemption
  41. 18IC The low profit margin exemption
  42. 18ID The tax exemption
  43. 18J Companies with total opening negative amount
  44. 18K Total opening negative amount: “matching”
  45. 18L Streaming
  46. 18M Streamed opening negative amounts: “matching”
  47. 18N Residual opening negative amount: “matching”
  48. 18O Transfers of foreign permanent establishment business
  49. 18P Exclusions
  50. 18Q Insurance companies
  51. 18R Meaning of “full treaty territory”
  52. 18S Other interpretation
  53. 19 Chargeable profits
  54. 20 Profits attributable to permanent establishment: introduction
  55. 21 The separate enterprise principle
  56. 22 Transactions treated as being on arm's length terms
  57. 23 Provision of goods or services for permanent establishment
  58. 24 Application to insurance companies
  59. 25 Non-UK resident banks: introduction
  60. 26 Transfer of financial assets
  61. 27 Loans: attribution of financial assets and profits arising
  62. 28 Borrowing: permanent establishment acting as agent or intermediary
  63. 29 Allowable deductions
  64. 30 Restriction on deductions: costs
  65. 31 Restriction on deductions: payments in respect of intangible assets
  66. 32 Restriction on deductions: interest or other financing costs
  67. 33 Trade includes office
  68. 34 Overview of Part
  69. 35 Charge to tax on trade profits
  70. 36 Farming and market gardening
  71. 37 Commercial occupation of woodlands
  72. 38 Commercial occupation of land other than woodlands
  73. 39 Profits of mines, quarries and other concerns
  74. 40 Credit unions
  75. 40A Payments to company directors
  76. 40B Professionals in practice: incidental income from an office or employment
  77. 41 Effect of company starting or ceasing to be within charge to corporation tax
  78. 42 Tied premises
  79. 43 Caravan sites where trade carried on
  80. 44 Surplus business accommodation
  81. 45 Payments for wayleaves
  82. 46 Generally accepted accounting practice
  83. 47 Losses calculated on same basis as profits
  84. 48 Receipts and expenses
  85. 49 Items treated as receipts and expenses
  86. 49A Money's worth
  87. 50 Animals kept for trade purposes
  88. 51 Relationship between rules prohibiting and allowing deductions
  89. 52 Apportionment etc of profits and losses to accounting period
  90. 53 Capital expenditure
  91. 54 Expenses not wholly and exclusively for trade and unconnected losses
  92. 55 Bad debts
  93. 56 Car ... hire
  94. 57 Car ... hire: supplementary
  95. 58 Hiring cars (but not motor cycles) with low CO2 emissions before 1 April 2013
  96. 58A Short-term hiring in and long-term hiring out
  97. 58B Connected persons: application of section 56
  98. 59 Patent royalties
  99. 60 Expenditure on integral features
  100. 60A Rental rebates
  101. 61 Pre-trading expenses
  102. 62 Tenants under taxed leases: introduction
  103. 63 Tenants occupying land for purposes of trade treated as incurring expenses
  104. 64 Limit on deductions if tenant entitled to mineral extraction allowance
  105. 65 Tenants dealing with land as property employed for purposes of trade
  106. 66 Restrictions on section 63 expenses: lease premium receipts
  107. 67 Restrictions on section 63 expenses: lease of part of premises
  108. 68 Replacement and alteration of trade tools
  109. 69 Payments for restrictive undertakings
  110. 70 Employees seconded to charities and educational establishments
  111. 71 Educational establishments
  112. 72 Payroll deduction schemes: contributions to agents' expenses
  113. 73 Counselling and other outplacement services
  114. 74 Retraining courses
  115. 75 Retraining courses: recovery of tax
  116. 76 Redundancy payments and approved contractual payments
  117. 77 Payments in respect of employment wholly in employer's trade
  118. 78 Payments in respect of employment in more than one capacity
  119. 79 Additional payments
  120. 80 Application of section 79 in cases involving partnerships
  121. 81 Payments made by the Government
  122. 82 Contributions to local enterprise organisations or urban regeneration companies
  123. 83 Meaning of “local enterprise organisation”
  124. 84 Approval of local enterprise agencies
  125. 85 Supplementary provisions with respect to approvals
  126. 86 Meaning of “urban regeneration company”
  127. 86A Contributions to flood and coastal erosion risk management projects
  128. 86B Interpretation of section 86A
  129. 87 Expenses of research and development
  130. 88 Payments to research associations, universities etc
  131. 89 Expenses connected with patents
  132. 90 Expenses connected with designs or trade marks
  133. 91 Payments to Export Credits Guarantee Department
  134. 92 Levies etc under FISMA 2000
  135. 92A Deductions in relation to salaried members
  136. 93 Capital receipts
  137. 94 Debts incurred and later released
  138. 95 Acquisition of trade: receipts from transferor's trade
  139. 96 Reverse premiums
  140. 97 Excluded cases
  141. 98 Tax treatment of reverse premiums
  142. 99 Arrangements not at arm's length
  143. 100 Connected persons and property arrangements
  144. 101 Distribution of assets of mutual concerns
  145. 102 Industrial development grants
  146. 103 Sums recovered under insurance policies etc
  147. 104 Repayments under FISMA 2000
  148. 105 Gifts of trading stock to charities etc
  149. 106 Meaning of “designated educational establishment”
  150. 107 Gifts of medical supplies and equipment
  151. 108 Receipt of benefits by donor or connected person
  152. 109 Election for application of herd basis rules
  153. 110 Meaning of “animal”, “herd”, “production herd” etc
  154. 111 Other interpretative provisions
  155. 112 Initial cost of herd and value of herd
  156. 113 Addition of animals to herd
  157. 114 Replacement of animals in herd
  158. 115 Amount of receipt if old animal slaughtered under disease control order
  159. 116 Sale of animals from herd
  160. 117 Sale of whole or substantial part of herd
  161. 118 Acquisition of new herd begun within 5 years of sale
  162. 119 Section 118: sale for reasons outside farmer's control
  163. 120 Replacement of part sold begun within 5 years of sale
  164. 121 Section 120: sale for reasons outside farmer's control
  165. 122 Herd basis elections
  166. 123 Five year gap in which no production herd kept
  167. 124 Slaughter under disease control order
  168. 125 Preventing abuse of the herd basis rules
  169. 126 Information if election made
  170. 127 Further assessment etc if herd basis rules apply
  171. 127A Application of Chapter 8A
  172. 127B Right to make claim
  173. 127C Book value
  174. 127D Effect of claim for spreading of profits
  175. 127E Adjustment: cessation of trading
  176. 127F Time limits etc for spreading claim
  177. 127G Interpretation
  178. 128 Taxation of amounts taken to reserves
  179. 129 Conversion etc of securities held as circulating capital
  180. 130 Insurers receiving distributions etc
  181. 130A Insurers in financial difficulties: write-down orders
  182. 131 Incidental costs of issuing qualifying shares
  183. 132 Dividends etc granted by registered societies
  184. 133 Annual payments paid by a credit union
  185. 133A Compensation payments: restriction of deductions
  186. 133B Companies affected by section 133A: amounts treated as received
  187. 133C The disclosure condition
  188. 133D Excluded expenses
  189. 133E Meaning of “banking company”
  190. 133F “Excluded company”
  191. 133G Meaning of “relevant regulated activity”
  192. 133H Investment bank
  193. 133I Meaning of “insurance company”
  194. 133J Meaning of “customer”
  195. 133K “Compensation” and related expressions
  196. 133L Associated companies
  197. 133M Application of sections 133A and 133B in relation to corporate partner
  198. 133N Powers to amend
  199. 134 Purchase or sale of woodlands
  200. 135 Relief in respect of mineral royalties
  201. 136 Lease premiums etc: reduction of receipts
  202. 137 Mineral exploration and access
  203. 138 Payments by companies liable to pool betting duty
  204. 139 Deduction for deemed employment payment
  205. 140 Special rules for partnerships
  206. 141 Deduction for deemed employment payments
  207. 141A Intermediaries providing worker's services to public authority or medium or large client
  208. 142 Deduction for site preparation expenditure
  209. 143 Allocation of site preparation expenditure
  210. 144 Site preparation expenditure: supplementary
  211. 145 Site restoration payments
  212. 146 Cemeteries and crematoria: introduction
  213. 147 Deduction for capital expenditure
  214. 148 Allocation of ancillary capital expenditure
  215. 149 Exclusion of expenditure met by subsidies
  216. 149A Niches, memorials and inscriptions: introduction
  217. 149B Allowable deductions: niches
  218. 149C Allowable deductions: memorials
  219. 149D Allowable deductions: inscriptions
  220. 149E Costs of the building
  221. 150 Revenue nature of expenditure
  222. 151 Allocation of expenditure
  223. 152 Interpretation of sections 150 and 151
  224. 153 Reserves of marketing authorities and certain other statutory bodies
  225. 154 Conditions to be met by reserve fund
  226. 155 Interpretation of sections 153 and 154
  227. 156 Meaning of “trading stock”
  228. 157 Trading stock appropriated by trader
  229. 158 Trading stock supplied by trader
  230. 159 Disposals not made in the course of trade
  231. 160 Acquisitions not made in the course of trade
  232. 161 Transfer pricing rules to take precedence
  233. 162 Valuation of trading stock on cessation
  234. 163 Meaning of “trading stock”
  235. 164 Basis of valuation of trading stock
  236. 165 Sale basis of valuation: sale to unconnected person
  237. 166 Sale basis of valuation: sale to connected person
  238. 167 Sale basis of valuation: election by connected persons
  239. 168 Connected persons
  240. 169 Cost to buyer of stock valued on sale basis of valuation
  241. 170 Meaning of “sale” and related expressions
  242. 171 Determination of questions
  243. 172 Application of Chapter
  244. 173 Relief for unremittable amounts
  245. 174 Restrictions on relief
  246. 175 Withdrawal of relief
  247. 176 Meaning of “know-how” etc
  248. 177 Disposal of know-how if trade continues to be carried on
  249. 178 Disposal of know-how as part of disposal of all or part of a trade
  250. 179 Seller controlled by buyer etc
  251. 180 Application of Chapter
  252. 181 Giving effect to positive and negative adjustments
  253. 182 Calculation of the adjustment
  254. 183 No adjustment for certain expenses previously brought into account
  255. 184 Cases where adjustment not required until assets realised or written off
  256. 185 Change from realisation basis to mark to market
  257. 186 Election for spreading if section 185 applies
  258. 187 Transfer of insurance business
  259. 188 Charge to tax on post-cessation receipts
  260. 189 Extent of charge to tax
  261. 190 Basic meaning of “post-cessation receipt”
  262. 191 Other rules about what counts as post-cessation receipts
  263. 192 Debts paid after cessation
  264. 193 Debts released after cessation
  265. 194 Transfer of rights if transferee does not carry on trade
  266. 195 Transfer of trading stock
  267. 196 Allowable deductions
  268. 197 Further rules about allowable deductions
  269. 198 Election to carry back
  270. 199 Deductions already made are not displaced
  271. 200 Election given effect in accounting period in which receipt is received
  272. 201 Provisions which must be given priority over this Part
  273. 202 Overview of Part
  274. 203 Overview of Chapter
  275. 204 Meaning of “property business”
  276. 205 UK property business
  277. 206 Overseas property business
  278. 207 Meaning of “generating income from land”
  279. 208 Activities not for generating income from land
  280. 209 Charge to tax on profits of a property business
  281. 210 Profits of a property business: application of trading income rules
  282. 211 Loan relationships and derivative contracts
  283. 212 Items treated as receipts and expenses
  284. 213 Certain amounts brought into account under Part 3
  285. 214 Relationship between rules prohibiting and allowing deductions
  286. 215 Overview of Chapter
  287. 216 Meaning of “short-term lease”
  288. 217 Lease premiums
  289. 218 Amount treated as lease premium where work required
  290. 219 Sums payable instead of rent
  291. 220 Sums payable for surrender of lease
  292. 221 Sums payable for variation or waiver of terms of lease
  293. 221A Sums to which sections 217 to 221 do not apply
  294. 222 Assignments for profit of lease granted at undervalue
  295. 223 Provisions supplementary to section 222
  296. 224 Sales with right to reconveyance
  297. 225 Sale and leaseback transactions
  298. 226 Provisions supplementary to sections 224 and 225
  299. 227 Circumstances in which additional calculation rule applies
  300. 228 The additional calculation rule
  301. 229 The additional calculation rule: special cases
  302. 230 Meaning of “unused amount” and “unreduced amount”
  303. 231 Deductions for expenses under section 232
  304. 232 Tenants under taxed leases treated as incurring expenses
  305. 233 Restrictions on section 232 expenses: the additional calculation rule
  306. 234 Restrictions on section 232 expenses: lease of part of premises
  307. 235 Limit on reductions and deductions
  308. 236 Payment of tax by instalments
  309. 237 Statement of accuracy for purposes of section 222
  310. 238 Claim for repayment of tax payable by virtue of section 224
  311. 239 Claim for repayment of tax payable by virtue of section 225
  312. 240 Appeals against proposed determinations
  313. 241 Section 240: supplementary
  314. 242 Determination by tribunal
  315. 243 Rules for determining effective duration of lease
  316. 244 Applying the rules in section 243
  317. 245 Information about effective duration of lease
  318. 246 Provisions about premiums
  319. 247 Interpretation
  320. 248 Furnished lettings
  321. 248A Wear and tear allowance: election
  322. 248B Meaning of “eligible” in relation to a dwelling-house
  323. 248C Effect of wear and tear allowance election
  324. 249 Acquisition of business: receipts from transferor's UK property business
  325. 250 Reverse premiums
  326. 250A Replacement domestic items relief
  327. 251 Deduction for expenditure on energy-saving items
  328. 252 Restrictions on relief
  329. 253 Regulations
  330. 254 Deduction for expenditure on sea walls
  331. 255 Transfer of interest in premises
  332. 256 Ending of lease of premises
  333. 257 Transfer involving person within the charge to income tax
  334. 258 Relief in respect of mineral royalties
  335. 259 Nature of item apportioned on sale of estate or interest in land
  336. 260 Mutual business
  337. 261 Adjustment on change of basis
  338. 262 Giving effect to positive and negative adjustments
  339. 263 Expenditure on integral features
  340. 270 Charge to tax on rent receivable in connection with a UK section 39(4) concern
  341. 271 Meaning of “rent receivable in connection with a UK section 39(4) concern”
  342. 272 Deduction for management expenses of owner of mineral rights
  343. 273 Relief in respect of mineral royalties
  344. 274 Meaning of “mineral lease or agreement” and “mineral royalties”
  345. 275 Extended meaning of “mineral royalties” etc in Northern Ireland
  346. 276 Power to determine what counts as “mineral royalties”
  347. 277 Charge to tax on rent receivable for a UK electric-line wayleave
  348. 278 Meaning of “rent receivable for a UK electric-line wayleave”
  349. 279 Extent of charge to tax
  350. 280 Charge to tax on post-cessation receipts
  351. 281 Extent of charge to tax
  352. 282 Basic meaning of “post-cessation receipt”
  353. 283 Other rules about what counts as a “post-cessation receipt”
  354. 284 Transfer of rights if transferee does not carry on UK property business
  355. 285 Allowable deductions
  356. 286 Election to carry back
  357. 287 Provisions which must be given priority over this Part
  358. 288 Priority between Chapters within this Part
  359. 289 Effect of company starting or ceasing to be within charge to corporation tax
  360. 290 Overseas property businesses and overseas land: adaptation of rules
  361. 291 Meaning of “lease” and “premises”
  362. 292 Overview of Part
  363. 293 Construction of references to profits or losses from loan relationships
  364. 294 Matters treated as loan relationships
  365. 295 General rule: profits arising from loan relationships chargeable as income
  366. 296 Profits and deficits to be calculated using credits and debits given by this Part
  367. 297 Trading credits and debits to be brought into account under Part 3
  368. 298 Meaning of trade and purposes of trade
  369. 299 Charge to tax on non-trading profits
  370. 300 Method of bringing non-trading deficits into account
  371. 301 Calculation of non-trading profits and deficits from loan relationships: non-trading credits and debits
  372. 302 “Loan relationship”, “creditor relationship”, “debtor relationship”
  373. 303 “Money debt”
  374. 304 “Related transaction”
  375. 305 Payments, interest, rights and liabilities under a loan relationship
  376. 306 Overview of Chapter
  377. 306A Matters in respect of which amounts to be brought into account
  378. 307 General principles about the bringing into account of credits and debits
  379. 308 Amounts recognised in determining a company's profit or loss
  380. 309 Companies without GAAP-compliant accounts
  381. 310 Power to make regulations about recognised amounts
  382. 311 Amounts not fully recognised for accounting purposes: introduction
  383. 312 Determination of credits and debits where amounts not fully recognised
  384. 313 Basis of accounting: “amortised cost basis”, “fair value accounting” and “fair value”
  385. 314 Power to make regulations about changes from amortised cost basis
  386. 315 Introduction to sections 316 and 318
  387. 316 Change of basis of accounting involving change of value
  388. 317 Carrying value
  389. 318 Change of accounting basis following cessation of loan relationship
  390. 319 General power to make regulations about changes in accounting policy
  391. 320 Credits and debits treated as relating to capital expenditure
  392. 320A Amounts recognised in other comprehensive income and not transferred to profit or loss
  393. 320B Hybrid capital instruments: amounts recognised in equity
  394. 321 Credits and debits recognised in equity
  395. 321A Restriction on debits resulting from release of loans to participators etc
  396. 322 Release of debts: cases where credits not required to be brought into account
  397. 323 Meaning of expressions relating to insolvency etc
  398. 323A Substantial modification: cases where credits not required to be brought into account
  399. 323B Insurers in financial difficulties: write-down orders
  400. 324 Restriction on debits resulting from revaluation
  401. 325 Restriction on credits resulting from reversal of disallowed debits
  402. 326 Writing off government investments
  403. 327 Disallowance of imported losses etc
  404. 328 Exchange gains and losses
  405. 328A Arrangements that have a “one-way exchange effect”
  406. 328B Meaning of “relevant exchange gain” and “relevant exchange loss”
  407. 328C Meaning of “test day”
  408. 328D Counterfactual currency movement assumptions
  409. 328E Counterfactual currency movement assumptions: treatment of options
  410. 328F Meaning of “option”
  411. 328G Meaning of “relevant contingent contract” and “operative condition”
  412. 328H Other interpretative provisions
  413. 329 Pre-loan relationship and abortive expenses
  414. 330 Debits in respect of pre-trading expenditure
  415. 330ZA Debits referable to times before UK property business etc carried on
  416. 330A Company is not, or has ceased to be, party to loan relationship
  417. 330B Exclusion of debit where relief allowed to another
  418. 330C Avoidance of double charge
  419. 331 Company ceasing to be party to loan relationship
  420. 332 Repo, stock lending and other transactions
  421. 333 Company ceasing to be UK resident
  422. 334 Non-UK resident company ceasing to hold loan relationship for section 333(2) purposes
  423. 335 Introduction to Chapter
  424. 336 Transfers of loans on group transactions
  425. 337 Transfers of loans on insurance business transfers
  426. 338 Meaning of company replacing another as party to loan relationship
  427. 339 Issues of new securities on certain cross-border reorganisations
  428. 340 Group transfers and transfers of insurance business: transfer at notional carrying value
  429. 341 Transferor using fair value accounting
  430. 342 Issues of new securities on reorganisations: disposal at notional carrying value
  431. 343 Receiving company using fair value accounting
  432. 344 Introduction
  433. 345 Transferee leaving group otherwise than because of exempt distribution
  434. 346 Transferee leaving group because of exempt distribution
  435. 347 Disapplication of Chapter where transferor party to avoidance
  436. 348 Introduction: meaning of “connected companies relationship”
  437. 349 Application of amortised cost basis to connected companies relationships
  438. 350 Companies beginning to be connected
  439. 351 Companies ceasing to be connected
  440. 352 Disregard of related transactions
  441. 352A Exclusion of credits on reversal of disregarded loss
  442. 352B Eliminating tax mismatch for loan relationships with qualifying link
  443. 353 Introduction to Chapter
  444. 354 Exclusion of debits for impaired or released connected companies debts
  445. 355 Cessation of connection
  446. 356 Exception to section 354: swapping debt for equity
  447. 357 Exception to section 354: insolvent creditors
  448. 358 Exclusion of credits on release of connected companies debts: general
  449. 359 Exclusion of credits on release of connected companies debts during creditor's insolvency
  450. 360 Exclusion of credits on reversal of impairments of connected companies debts
  451. 361 Acquisition of creditor rights by connected company at undervalue
  452. 361A The corporate rescue exception
  453. 361B The debt-for-debt exception
  454. 361C The equity-for-debt exception
  455. 361D Corporate rescue: debt released shortly after acquisition
  456. 362 Parties becoming connected where creditor's rights subject to impairment adjustment etc
  457. 362A Corporate rescue: debt released shortly after connection arises
  458. 363 Companies connected for sections 361 to 362A
  459. 363A Arrangements for avoiding section 361 or 362
  460. 364 Introduction to Chapter
  461. 365 Reduction of impairment loss debits where group relief claimed
  462. 366 Effect where credit for release brought into account on amortised cost basis
  463. 367 Reduction of credits exceeding impairment losses
  464. 368 Reduction of claims where there are earlier net consortium debits
  465. 369 Carry forward of claims where there are no net consortium debits
  466. 370 Group accounting periods
  467. 371 Interpretation
  468. 372 Introduction to Chapter
  469. 373 Late interest treated as not accruing until paid in some cases
  470. 374 Connection between debtor and person standing in position of creditor
  471. 375 Loans to close companies by participators etc
  472. 376 Interpretation of section 375
  473. 377 Party to loan relationship having major interest in other party
  474. 378 Loans by trustees of occupational pension schemes
  475. 379 Persons indirectly standing in the position of creditor
  476. 380 Partnerships involving companies
  477. 381 Determinations of credits and debits by company partners: general
  478. 382 Company partners using fair value accounting
  479. 383 Lending between partners and the partnership
  480. 384 Treatment of exchange gains and losses
  481. 385 Company partners' shares where firm owns deeply discounted securities
  482. 386 Overview of Chapter
  483. 387 Treatment of deficit on basic life assurance and general annuity business: introduction
  484. 388 Basic rule: deficit set off against income and gains of deficit period
  485. 389 Claim to carry back deficit
  486. 390 Meaning of “available profits”
  487. 391 Carry forward of surplus deficit to next accounting period
  488. 392 Exclusion of loan relationships of members of Lloyd's
  489. 393 General rules for some debtor relationships
  490. 394 Special rules for some debtor relationships
  491. 395 Investment trusts: profits or losses of a capital nature
  492. 396 Venture capital trusts: profits or losses of a capital nature
  493. 397 Credit unions
  494. 398 Overview of Chapter
  495. 399 Basic rules
  496. 400 Adjustments for changes in index
  497. 400A Adjustments for changes in index: relevant hedging schemes
  498. 400B Interpretation of section 400A: economic profits and losses
  499. 400C Meaning of “associated with”
  500. 401 Gilt strips
  501. 402 Market value of securities
  502. 403 Meaning of “strip”
  503. 404 Restriction on deductions etc relating to FOTRA securities
  504. 405 Certain non-UK residents with interest on 3½% War Loan 1952 Or After
  505. 406 Introduction
  506. 407 Postponement until redemption of debits for connected companies' deeply discounted securities
  507. 408 Companies connected for section 407
  508. 409 Postponement until redemption of debits for close companies' deeply discounted securities
  509. 410 Exceptions to section 409
  510. 411 Interpretation of section 409
  511. 412 Persons indirectly standing in the position of creditor
  512. 413 Issue of funding bonds
  513. 414 Redemption of funding bonds
  514. 415 Loan relationships with embedded derivatives
  515. 416 Election for application of sections 415 and 585
  516. 417 Further provisions about elections under section 416
  517. 418 Loan relationships involving connected debtor and creditor where debits exceed credits
  518. 418A Cases involving host contract
  519. 419 Section 418: supplementary
  520. 420 Assumptions where options etc apply
  521. 420A Amounts payable in respect of hybrid capital instruments
  522. 421 Introduction to Chapter
  523. 422 Transfer of loan relationship at notional carrying value
  524. 423 Transferor using fair value accounting
  525. 424 Reorganisations involving loan relationships
  526. 425 Original holder using fair value accounting
  527. 426 Tax avoidance etc
  528. 427 Procedure on application for clearance
  529. 428 Decision on application for clearance
  530. 429 Disapplication of Chapter where transparent entities involved
  531. 430 Interpretation
  532. 431 Introduction to Chapter
  533. 432 Meaning of “the transferee” and “transferor”
  534. 433 Transfer of loan relationship at notional carrying value
  535. 434 Transferor using fair value accounting
  536. 435 Reorganisations involving loan relationships
  537. 436 Original holder using fair value accounting
  538. 437 Tax avoidance etc
  539. 438 Disapplication of Chapter where transparent entities involved
  540. 439 Interpretation
  541. 440 Overview of Chapter
  542. 441 Loan relationships for unallowable purposes
  543. 442 Meaning of “unallowable purpose”
  544. 443 Restriction of relief for interest where tax relief schemes involved
  545. 444 Transactions not at arm's length: general
  546. 445 Disapplication of section 444 where Part 4 of TIOPA 2010 applies
  547. 446 Bringing into account adjustments made under Part 4 of TIOPA 2010
  548. 446A Non-market loans
  549. 447 Exchange gains and losses on debtor relationships: loans disregarded under Part 4 of TIOPA 2010
  550. 448 Exchange gains and losses on debtor relationships: equity notes where holder associated with issuer
  551. 450 Meaning of “corresponding debtor relationship”
  552. 452 Exchange gains and losses where loan not on arm's length terms
  553. 453 Connected parties deriving benefit from creditor relationships
  554. 454 Application of fair value accounting: reset bonds etc
  555. 455 Disposals for consideration not fully recognised by accounting practice
  556. 455A Debits arising from derecognition of creditor relationships
  557. 455B Counteracting effect of avoidance arrangements
  558. 455C Interpretation of section 455B
  559. 455D Examples of results that may indicate exclusion not applicable
  560. 456 Introduction to Chapter
  561. 457 Basic rule for deficits: carry forward to accounting periods after deficit period
  562. 458 Claim to carry forward deficit to later accounting periods
  563. 459 Claim to set off deficit against profits of deficit period or earlier periods
  564. 460 Time limits and procedure for claims under section 459(1)
  565. 461 Claim to set off deficit against other profits for the deficit period
  566. 462 Claim to carry back deficit to earlier accounting periods
  567. 463 Profits available for relief under section 462
  568. 463A Introduction to Chapter
  569. 463B Claim to set off deficit against profits of deficit period or earlier periods
  570. 463C Time limits for claims under section 463B(1)
  571. 463D Claim to set off deficit against profits for the deficit period
  572. 463E Claim to carry back deficit to earlier periods
  573. 463F Profits available for relief under section 463E
  574. 463G Carry forward of unrelieved deficit against total profits
  575. 463H Carry forward of unrelieved deficit against non-trading profits
  576. 463I Re-application of section 463G if any deficit remains after previous application
  577. 464 Priority of this Part for corporation tax purposes
  578. 465 Exclusion of distributions except in tax avoidance cases
  579. 465A Power to make regulations where accounting standards change
  580. 465B “Tax-adjusted carrying value”
  581. 466 Companies connected for an accounting period
  582. 467 Connections where partnerships are involved
  583. 468 Connection between companies to be ignored in some circumstances
  584. 469 Creditors who are financial traders
  585. 470 Section 469: supplementary provisions
  586. 471 Creditors who are insurance companies carrying on BLAGAB
  587. 472 Meaning of “control”
  588. 473 Meaning of “major interest”
  589. 474 Treatment of connected companies and partnerships for section 473
  590. 475 Meaning of expressions relating to exchange gains and losses
  591. 475A “Hedging relationship”
  592. 475B Meaning of “matched”
  593. 475C Meaning of “hybrid capital instrument”
  594. 476 Other definitions
  595. 477 Overview of Part
  596. 478 Relevant non-lending relationships: introduction
  597. 479 Relevant non-lending relationships not involving discounts
  598. 480 Relevant non-lending relationships involving discounts
  599. 481 Application of Part 5 to relevant non-lending relationships
  600. 482 Miscellaneous rules about amounts to be brought into account because of this Chapter
  601. 483 Exchange gains and losses: amounts treated as money debts
  602. 484 Provision not at arm's length: meaning of “interest” and “money debt”
  603. 485 Exclusion of debts where profits or losses within Part 7 or 8
  604. 486 Exclusion of exchange gains and losses in respect of tax debts etc
  605. 486A Overview
  606. 486B Disguised interest to be regarded as profit from loan relationship
  607. 486C Exclusion where return otherwise taxable
  608. 486D Exclusion where arrangement has no tax avoidance purpose
  609. 486E Excluded shares
  610. 486F Introduction to Chapter
  611. 486G Consideration to be treated as loan relationship
  612. 487 Overview of Chapter
  613. 488 Meaning of “open-ended investment company” etc
  614. 489 Meaning of “offshore fund” etc
  615. 490 Holdings in OEICs, unit trusts and offshore funds treated as creditor relationship rights
  616. 491 Holding coming within section 490: opening valuations
  617. 492 Holding coming within section 490: calculation to undo avoidance
  618. 493 The qualifying investments test
  619. 494 Meaning of “qualifying investments”
  620. 495 Qualifying holdings
  621. 496 Meaning of “hedging relationship”
  622. 497 Power to change investments that are qualifying investments
  623. 498 Building society dividends and interest
  624. 499 Registered society payments treated as interest under loan relationship
  625. 500 Exclusion of interest where failure to make return
  626. 501 Introduction to Chapter
  627. 502 Meaning of “financial institution”
  628. 503 Purchase and resale arrangements
  629. 504 Diminishing shared ownership arrangements : initial acquisition
  630. 504A Diminishing shared ownership arrangements: refinancing
  631. 505 Deposit arrangements
  632. 506 Profit share agency arrangements
  633. 507 Investment bond arrangements
  634. 508 Provision not at arm's length: exclusion of arrangements from sections 503 to 507
  635. 509 Application of Part 5: general
  636. 510 Application of Part 5 to particular alternative finance arrangements
  637. 511 Purchase and resale arrangements
  638. 512 Diminishing shared ownership arrangements
  639. 513 Other arrangements
  640. 514 Exclusion of alternative finance return from consideration for sale of assets
  641. 515 Diminishing shared ownership arrangements : further provision
  642. 515A Diminishing shared ownership arrangements: further provision in respect of refinancing
  643. 516 Treatment of principal under profit sharing agency arrangements
  644. 517 Treatment of bond-holder under investment bond arrangements
  645. 518 Investment bond arrangements: treatment as securities
  646. 519 Investment bond arrangements: other provisions
  647. 520 Provision not at arm's length: non-deductibility of relevant return
  648. 521 Power to extend this Chapter to other arrangements
  649. 521A Introduction to Chapter
  650. 521B Application of Part 5 to certain shares as rights under creditor relationship
  651. 521C Shares accounted for as liabilities
  652. 521D Excepted shares
  653. 521E Unallowable purpose
  654. 521F Shares becoming or ceasing to be shares to which section 521B applies
  655. 522 Introduction to Chapter
  656. 523 Application of Part 5 to certain shares as rights under creditor relationship
  657. 524 Shares subject to outstanding third party obligations
  658. 525 Meaning of “interest-like investment”
  659. 526 Non-qualifying shares
  660. 527 The increasing value condition
  661. 528 Regulations about income-producing assets
  662. 529 The redemption return condition
  663. 530 The redemption return condition: excepted shares
  664. 531 The redemption return condition: unallowable purposes
  665. 532 The associated transactions condition
  666. 533 Power to change conditions for non-qualifying shares
  667. 534 Amounts to be brought into account where section 523 applies
  668. 535 Shares ceasing to be shares to which section 523 applies
  669. 536 Introduction to Chapter
  670. 537 Payments in return for capital contribution to partnership
  671. 538 Change of partnership shares
  672. 539 Introduction to Chapter
  673. 540 Manufactured interest treated as interest under loan relationship
  674. 541 Debits for deemed interest under stock lending arrangements disallowed
  675. 542 Introduction to Chapter
  676. 543 Meaning of creditor repo
  677. 544 Meaning of creditor quasi-repo
  678. 545 Ignoring effect on lender etc of sale of securities
  679. 546 Charge on lender for finance return in respect of the advance
  680. 547 Repo under arrangement designed to produce quasi-interest: tax avoidance
  681. 548 Meaning of debtor repo
  682. 549 Meaning of debtor quasi-repo
  683. 550 Ignoring effect on borrower of sale of securities
  684. 551 Relief for borrower for finance charges in respect of the advance
  685. 552 General provisions about arrangements
  686. 553 Persons buying or selling for others
  687. 554 Power to modify this Chapter
  688. 555 Cases where section 554 applies: non-standard repos
  689. 556 Meaning of securities and similar securities
  690. 557 Meaning of person receiving an asset
  691. 558 Interpretation of accounting expressions
  692. 559 Minor definitions
  693. 560 Introduction to Chapter
  694. 561 Meaning of “investment life insurance contract”
  695. 562 Contract to be loan relationship
  696. 563 Increased non-trading credits for BLAGAB and EEA taxed contracts
  697. 564 Section 563: interpretation
  698. 565 Relevant amount where the relevant company uses fair value accounting
  699. 566 Introduction
  700. 567 Gains on deemed surrenders to be brought into account on related transactions
  701. 568 Restriction on credits on old contracts: fair value accounting cases
  702. 569 Restriction on debits on old contracts: non-fair value accounting cases
  703. 570 Overview of Part
  704. 571 General rule: profits chargeable as income
  705. 572 Profits and losses to be calculated using credits and debits given by this Part
  706. 573 Trading credits and debits to be brought into account under Part 3
  707. 574 Non-trading credits and debits to be brought into account under Part 5
  708. 575 Overview of Chapter
  709. 576 “Derivative contract”
  710. 577 “Relevant contract”
  711. 578 Relevant contracts of a company and being party to such contracts
  712. 579 The accounting conditions
  713. 580 “Option”
  714. 581 “Future”
  715. 582 “Contract for differences”
  716. 583 “Underlying subject matter”
  717. 584 Hybrid derivatives with embedded derivatives
  718. 585 Loan relationships with embedded derivatives
  719. 586 Other contracts with embedded derivatives
  720. 587 Contract relating to holding in OEIC, unit trust or offshore fund
  721. 588 Associated transaction treated as derivative contract
  722. 589 Contracts excluded because of underlying subject matter: general
  723. 590 Disregard of subordinate or small value underlying subject matter
  724. 591 Conditions A to E mentioned in section 589(5)
  725. 592 Embedded derivatives treated as meeting condition in section 591 etc
  726. 593 Contracts where part of underlying subject matter is excluded property
  727. 594 Overview of Chapter
  728. 594A Matters in respect of which amounts are to be brought into account
  729. 595 General principles about the bringing into account of credits and debits
  730. 596 Meaning of “related transaction”
  731. 597 Amounts recognised in determining a company's profit or loss
  732. 598 Regulations about recognised amounts
  733. 599 Meaning of “amounts recognised for accounting purposes”
  734. 599A Amounts not fully recognised for accounting purposes: introduction
  735. 599B Determination of credits and debits where amounts not fully recognised
  736. 600 Contract which is or forms part of financial asset or liability
  737. 601 Contract relating to holding in OEIC, unit trust or offshore fund
  738. 602 Contract becoming one relating to holding in OEIC, unit trust or offshore fund
  739. 603 Associated transaction treated as derivative contract
  740. 604 Credits and debits treated as relating to capital expenditure
  741. 604A Amounts recognised in other comprehensive income and not transferred to profit or loss
  742. 605 Credits and debits recognised in equity
  743. 606 Exchange gains and losses
  744. 606A Arrangements that have a “one-way exchange effect”
  745. 606B Meaning of “relevant exchange gain” and “relevant exchange loss”
  746. 606C Meaning of “test day”
  747. 606D Counterfactual currency movement assumptions
  748. 606E Counterfactual currency movement assumptions: treatment of options
  749. 606F Meaning of “option”
  750. 606G Meaning of “relevant contingent contract” and “operative condition”
  751. 606H Other interpretative provisions
  752. 607 Pre-contract or abortive expenses
  753. 607ZA Debits referable to times before UK property business etc carried on
  754. 607A Company is not, or has ceased to be, party to derivative contract
  755. 607B Exclusion of debit where relief allowed to another
  756. 607C Avoidance of double charge
  757. 608 Company ceasing to be party to derivative contract
  758. 609 Company ceasing to be UK resident
  759. 610 Non-UK resident company ceasing to hold derivative contract for section 609(2) purposes
  760. 611 Release under statutory insolvency arrangement of liability under derivative contract
  761. 612 Overview of Chapter
  762. 613 Introduction to sections 614 and 615
  763. 614 Change of basis of accounting involving change of value
  764. 615 Change of accounting policy after ceasing to be party to derivative contract
  765. 616 Disapplication of fair value accounting
  766. 617 Election for section 616 not to apply
  767. 618 Elections under section 617: groups of companies
  768. 619 Partnerships involving companies
  769. 620 Determination of credits and debits by company partners
  770. 621 Company partners using fair value accounting
  771. 622 Contracts ceasing to be derivative contracts
  772. 623 Index-linked gilt-edged securities with embedded contracts for differences
  773. 624 Introduction to Chapter
  774. 625 Group member replacing another as party to derivative contract
  775. 626 Transactions to which section 625 applies
  776. 627 Meaning of company replacing another as party to derivative contract
  777. 628 Transferor using fair value accounting
  778. 629 Tax avoidance
  779. 630 Introduction to sections 631 and 632
  780. 631 Transferee leaving group otherwise than because of exempt distribution
  781. 632 Transferee leaving group because of exempt distribution
  782. 633 Mutual trading companies
  783. 634 Insurance companies
  784. 635 Creditor relationships: embedded derivatives which are options
  785. 636 Modifications of Chapter 5
  786. 637 Investment trusts: profits or losses of a capital nature
  787. 638 Venture capital trusts: profits or losses of a capital nature
  788. 639 Overview of Chapter
  789. 640 Credits and debits not to be brought into account under Part 5
  790. 641 Derivative contracts to be taxed on a chargeable gains basis
  791. 642 Exception from section 641
  792. 643 Contracts relating to land or certain tangible movable property
  793. 644 Income to be left out of account in determining whether section 643 applies
  794. 645 Creditor relationships: embedded derivatives which are options
  795. 646 Exclusions from section 645
  796. 647 Meaning of certain expressions in section 645
  797. 648 Creditor relationships: embedded derivatives which are exactly tracking contracts for differences
  798. 649 Meaning of certain expressions in section 648
  799. 650 Property based total return swaps
  800. 651 Credits and debits not to be brought into account under Part 3 or Part 5
  801. 652 Introduction to sections 653 to 655
  802. 653 Shares issued or transferred as a result of exercise of deemed option
  803. 654 Payment instead of disposal on exercise of deemed option
  804. 655 Ceasing to be party to debtor relationship when deemed option not exercised
  805. 656 Introduction to section 658
  806. 657 Meaning of “exactly tracking contract” in section 656
  807. 658 Chargeable gain or allowable loss treated as accruing
  808. 659 Meaning of “relevant credits” and “relevant debits”
  809. 660 Contract relating to holding in OEIC, unit trust or offshore fund
  810. 661 Contract which becomes derivative contract
  811. 662 Contracts ceasing to be derivative contracts
  812. 663 Contracts to which section 641 applies
  813. 664 Meaning of certain expressions in section 663
  814. 665 Introduction to section 666
  815. 666 Allowable loss treated as accruing
  816. 667 Shares acquired on exercise of non-embedded option
  817. 668 Shares acquired on running of future to delivery
  818. 669 Meaning of G and L in sections 667 and 668
  819. 670 Treatment of net gains and losses on exercise of option
  820. 671 Meaning of G, L and CV in section 670
  821. 672 Treatment of net gains and losses on disposal of certain embedded derivatives
  822. 673 Meaning of G, L and CV in section 672
  823. 674 Introduction to Chapter
  824. 675 Transfer of derivative contract at notional carrying value
  825. 676 Transferor using fair value accounting
  826. 677 Tax avoidance etc
  827. 678 Procedure on application for clearance
  828. 679 Decision on application for clearance
  829. 680 Disapplication of Chapter where transparent entities involved
  830. 681 Interpretation
  831. 682 Introduction to Chapter
  832. 683 Meaning of “the transferee” and “transferor”
  833. 684 Transfer of derivative contract at notional carrying value
  834. 685 Transferor using fair value accounting
  835. 686 Tax avoidance etc
  836. 687 Disapplication of Chapter where transparent entities involved
  837. 688 Interpretation
  838. 689 Overview of Chapter
  839. 690 Derivative contracts for unallowable purposes
  840. 691 Meaning of “unallowable purpose”
  841. 692 Allowance of accumulated net losses
  842. 693 Bringing into account adjustments under Part 4 of TIOPA 2010
  843. 694 Exchange gains and losses
  844. 695 Transfers of value to connected companies
  845. 695A Disguised distribution arrangements involving derivative contracts
  846. 696 Derivative contracts with non-UK residents
  847. 697 Exceptions to section 696
  848. 698 Disposals for consideration not fully recognised by accounting practice
  849. 698A Debits arising from derecognition of derivative contracts
  850. 698B Counteracting effect of avoidance arrangements
  851. 698C Interpretation of section 698B
  852. 698D Examples of results that may indicate exclusion not applicable
  853. 699 Priority of this Part for corporation tax purposes
  854. 700 Relationship of this Part to Part 5: loan relationships
  855. 701 Power to amend some provisions
  856. 701A Power to make regulations where accounting standards change
  857. 702 “Tax-adjusted carrying value”
  858. 703 “Chargeable asset”
  859. 704 “Creditor relationship” and “debtor relationship”
  860. 705 Expressions relating to exchange gains and losses
  861. 706 “Excluded body”
  862. 707 “Hedging relationship”
  863. 708 “Plain vanilla contract”
  864. 709 “Securities house”
  865. 710 Other definitions
  866. 711 Overview of Part
  867. 712 “Intangible asset”
  868. 713 “Intangible fixed asset”
  869. 714 “Royalty”
  870. 715 Application of this Part to goodwill
  871. 716 “Recognised” amounts and “GAAP-compliant accounts”
  872. 717 Companies without GAAP-compliant accounts
  873. 718 GAAP-compliant accounts: reference to consolidated group accounts
  874. 719 Accounting value
  875. 720 Introduction
  876. 721 Receipts recognised as they accrue
  877. 722 Receipts in respect of royalties so far as not dealt with under section 721
  878. 723 Revaluation
  879. 724 Negative goodwill
  880. 725 Reversal of previous accounting loss
  881. 726 Introduction
  882. 727 References to expenditure on an asset
  883. 728 Expenditure written off as it is incurred
  884. 729 Writing down on accounting basis
  885. 730 Writing down at fixed rate: election for fixed-rate basis
  886. 731 Writing down at fixed rate: calculation
  887. 732 Reversal of previous accounting gain
  888. 733 Overview of Chapter
  889. 734 Meaning of “realisation”
  890. 735 Asset written down for tax purposes
  891. 736 Asset shown in balance sheet and not written down for tax purposes
  892. 737 Apportionment in case of part realisation
  893. 738 Asset not shown in balance sheet
  894. 738A Realisation of assets previously subject to Northern Ireland rate
  895. 739 Meaning of “proceeds of realisation”
  896. 740 Abortive expenditure on realisation
  897. 741 Meaning of “chargeable intangible asset” and “chargeable realisation gain”
  898. 742 Asset written down on accounting basis
  899. 743 Asset written down at fixed rate
  900. 744 Effect of part realisation of asset
  901. 745 Introduction
  902. 746 “Non-trading credits” and “non-trading debits”
  903. 747 Assets held for purposes of trade
  904. 748 Assets held for purposes of property business
  905. 749 Assets held for purposes of mines, transport undertakings, etc
  906. 750 Assets held for purposes falling within more than one section
  907. 751 Non-trading gains and losses
  908. 752 Charge to tax on non-trading gains on intangible fixed assets
  909. 753 Treatment of non-trading losses
  910. 754 The relief: the “old asset” and “other assets”
  911. 755 Conditions relating to the old asset and its realisation
  912. 756 Conditions relating to expenditure on other assets
  913. 757 Claim for relief
  914. 758 How the relief is given: general
  915. 759 Determination of appropriate proportion of cost and adjusted cost
  916. 760 References to cost of asset where asset affected by change of accounting policy
  917. 761 Declaration of provisional entitlement to relief
  918. 762 Realisation and reacquisition
  919. 763 Disregard of deemed realisations and reacquisitions
  920. 764 Meaning of “company”, “group” and “subsidiary”
  921. 765 General rule: a company and its 75% subsidiaries form a group
  922. 766 Only effective 51% subsidiaries of principal company to be members of group
  923. 767 Principal company cannot be 75% subsidiary of another company
  924. 768 Company cannot be member of more than one group
  925. 769 Continuity of identity of group
  926. 770 Continuity where group includes an SE
  927. 771 Meaning of “effective 51% subsidiary”
  928. 772 Equity holders and profits or assets available for distribution
  929. 773 Supplementary provisions
  930. 774 Overview of Chapter
  931. 775 Transfers within a group
  932. 776 Meaning of “tax-neutral” transfer
  933. 777 Relief on realisation and reinvestment: application to group member
  934. 778 Relief on reinvestment: acquisition of group company: introduction
  935. 779 Rules that apply to cases within section 778(1)
  936. 780 Deemed realisation and reacquisition at market value
  937. 781 Character of credits and debits brought into account as a result of section 780
  938. 782 Certain transferees of businesses etc not treated as leaving group
  939. 782A Company leaving group because of relevant share disposal
  940. 783 Certain associated companies leaving group at the same time
  941. 784 Groups with a relevant connection
  942. 785 Principal company becoming member of another group
  943. 786 Character of credits and debits brought into account as a result of section 785
  944. 787 Company ceasing to be member of group because of exempt distribution
  945. 788 Provisions supplementing sections 780 to 787
  946. 789 Merger carried out for genuine commercial reasons
  947. 790 Provisions supplementing section 789
  948. 791 Application of roll-over relief in relation to degrouping charge
  949. 792 Reallocation of charge within group
  950. 793 Further requirements about elections under section 792
  951. 793A Effect of election under section 792
  952. 794 Application of roll-over relief in relation to reallocated charge
  953. 795 Recovery of charge from another group company or controlling director
  954. 796 Interpretation of section 795
  955. 797 Recovery under section 795: procedure etc
  956. 798 Recovery under section 795: time limit
  957. 799 Disregard of payments between group members for reliefs
  958. 800 Introduction
  959. 801 Right to dispose of or acquire excluded asset also excluded
  960. 802 Effect of partial exclusion
  961. 803 Non-commercial purposes etc
  962. 804 Assets for which capital allowances previously made
  963. 805 Rights over tangible assets
  964. 806 Financial assets
  965. 807 Rights in companies, trusts etc
  966. 807A Assets representing expenditure on separate creative production trade
  967. 809 Oil licences
  968. 810 Mutual trade or business
  969. 811 Sound recordings
  970. 812 Master versions of films
  971. 813 Computer software treated as part of cost of related hardware
  972. 814 Research and development
  973. 815 Election to exclude capital expenditure on software
  974. 816 Further provision about elections under section 815
  975. 816A Restrictions on goodwill and certain other assets
  976. 817 Overview of Chapter
  977. 818 Company reconstruction involving transfer of business
  978. 819 European cross-border transfers of business: introduction
  979. 820 Transfer of assets on European cross-border transfer of business
  980. 821 European cross-border mergers: introduction
  981. 822 Transfer of assets on European cross-border merger
  982. 823 Interpretation of sections 821 and 822
  983. 824 Transfer of business of building society to company
  984. 825 Application of sections 780 and 785 where transfer within section 824 occurs
  985. 826 Amalgamation of, or transfer of engagements by, certain societies
  986. 827 Claims to postpone charge on transfer
  987. 828 Relief on transfer
  988. 829 Charge on subsequent realisations
  989. 830 Exclusion from section 829 of group transfers
  990. 831 The genuine commercial transaction requirement and clearance
  991. 832 Procedure on application for clearance
  992. 833 Decision on application for clearance
  993. 834 Overview of Chapter
  994. 835 “Related party”
  995. 836 “Control”
  996. 837 “Major interest”
  997. 838 General rule
  998. 839 Rights and powers held jointly
  999. 840 Partnerships
  1000. 841 “Participator” and “associate”
  1001. 842 Introduction
  1002. 843 Who are connected persons
  1003. 844 Overview of Chapter
  1004. 845 Transfer between company and related party treated as at market value
  1005. 846 Transfers where provision subject to transfer pricing but section 147(3) or (5) does not apply
  1006. 847 Transfers involving other taxes
  1007. 848 Tax-neutral transfers
  1008. 848A Assets held for purposes of exempt foreign permanent establishments
  1009. 849 Transfers involving gifts of business assets
  1010. 849A Disincorporation relief: transfer values for post-FA 2002 goodwill
  1011. 849AB Grant of licence or other right treated as at market value
  1012. 849AC Grants not at arm's length
  1013. 849AD Grants involving other taxes
  1014. 849B Circumstances in which restrictions on debits in respect of goodwill etc apply
  1015. 849C Restrictions in a case within section 849B(4) or (5)
  1016. 849D Restrictions in a case within section 849B(6)
  1017. 850 Part realisation involving related party acquisition: exclusion of roll-over relief
  1018. 851 Delayed payment of royalty by company to related party
  1019. 852 Treatment of grants and other contributions to expenditure
  1020. 853 Grants to be left out of account for tax purposes
  1021. 854 Finance leasing etc
  1022. 855 Further provision about regulations under section 854
  1023. 856 Assets acquired or realised together
  1024. 857 Deemed market value or arm’s length acquisition: adjustment where nil or negligible accounting value
  1025. 858 Fungible assets
  1026. 859 Asset ceasing to be chargeable intangible asset: deemed realisation at market value
  1027. 860 Asset ceasing to be chargeable intangible asset: postponement of gain
  1028. 861 Treatment of postponed gain on subsequent realisation
  1029. 862 Treatment of postponed gain in other cases
  1030. 863 Asset becoming chargeable intangible asset
  1031. 863A Asset becoming chargeable intangible asset: EU exit charge
  1032. 864 Tax avoidance arrangements to be ignored
  1033. 865 Debits for expenditure not generally deductible for tax purposes
  1034. 866 Delayed payment of employees' remuneration
  1035. 867 Provisions supplementing section 866
  1036. 868 Delayed payment of pension contributions
  1037. 869 Bad debts etc
  1038. 870 Assumptions for calculating chargeable profits
  1039. 870A Claims for relief made under sections 152 and 153 of TCGA 1992
  1040. 871 Introduction to Chapter
  1041. 872 Adjustments in respect of change
  1042. 873 Effect of application of section 872 in later period and subsequently
  1043. 874 Original asset not subject to fixed-rate writing down
  1044. 875 Effect of application of section 874 in later period and subsequently
  1045. 876 Original asset subject to fixed-rate writing down
  1046. 877 Election for fixed-rate writing down in relation to resulting asset
  1047. 878 Exclusion of credits or debits brought into account under other provisions
  1048. 879 Subsequent events affecting asset subject to adjustment under this Chapter
  1049. 879A Introduction
  1050. 879B Requirement to write down at a fixed rate
  1051. 879C Restrictions on debits: pre-FA 2019 relevant assets
  1052. 879D Pre-FA 2019 relevant asset: the first case
  1053. 879E Pre-FA 2019 relevant asset: the second case
  1054. 879F Pre-FA 2019 relevant asset: the third case
  1055. 879G The preserved status condition etc
  1056. 879H Pre-FA 2019 relevant asset: the fourth case
  1057. 879I Restrictions on debits: no business or no qualifying IP assets acquired
  1058. 879J Meaning of qualifying IP asset
  1059. 879K Restrictions on debits: acquisition from individual or firm
  1060. 879L Meaning of relevant business and third party acquisition
  1061. 879M When the partial restrictions apply: qualifying IP assets
  1062. 879N When the partial restrictions apply: acquisition from individual or firm
  1063. 879O The partial restrictions on debits
  1064. 879P Date of acquisition of relevant asset
  1065. 880 Overview of Chapter
  1066. 881 Meaning of “pre-FA 2002 assets”
  1067. 882 Application of this Part to assets created or acquired on or after 1 April 2002
  1068. 883 Assets treated as created or acquired when expenditure incurred
  1069. 884 ... Goodwill: time of creation
  1070. 885 Assets representing non-qualifying expenditure: time of creation
  1071. 886 Assets representing production expenditure on films: time of creation
  1072. 887 General rule
  1073. 888 Cases where chargeable gains rule applies
  1074. 889 Cases where capital allowances general rule applies
  1075. 890 Fungible assets: application of section 858
  1076. 891 Realisation and acquisition of fungible assets
  1077. 892 Certain assets acquired on transfer of business or transfer within a group
  1078. 893 Assets whose value derives from pre-FA 2002 assets
  1079. 894 The preserved status conditions etc
  1080. 895 Assets acquired in connection with disposals of pre-FA 2002 assets
  1081. 896 Application to royalties
  1082. 897 Application to pre-FA 2002 assets consisting of telecommunication rights
  1083. 898 Relief where assets disposed of on or after 1 April 2002
  1084. 899 Relief where degrouping charge on asset arises on or after 1 April 2002
  1085. 900 Meaning of “chargeable asset within TCGA” in sections 898 and 899
  1086. 900A Introduction
  1087. 900B When an intangible fixed asset is a restricted asset: the first case
  1088. 900C When an intangible fixed asset is a restricted asset: the second case
  1089. 900D When an intangible fixed asset is a restricted asset: the third case
  1090. 900E Special rule: section 900B case
  1091. 900F Special rule: section 900C or 900D case
  1092. 900G Meaning of “relieving acquisition”
  1093. 900H Supplementary provision about when two persons are related
  1094. 900I Acquisition of asset in pursuance of an unconditional obligation
  1095. 900J Fungible assets: general
  1096. 900K Fungible assets: pre-FA 2002 assets and restricted assets
  1097. 900L Realisation of fungible assets: pre-FA 2002 assets and restricted assets
  1098. 900M Acquisition of fungible assets: pre-FA 2002 assets and restricted assets
  1099. 900N Debits in respect of a single asset comprising restricted assets
  1100. 900O Interpretation
  1101. 901 Effect of application of the I - E basis: non-trading amounts
  1102. 902 Excluded assets
  1103. 903 Elections to exclude capital expenditure on computer software
  1104. 904 Transfers of life assurance business: transfers of assets treated as tax-neutral
  1105. 905 Pre-FA 2002 assets: Lloyd's syndicate capacity
  1106. 906 Priority of this Part for corporation tax purposes
  1107. 907 Overview of Part
  1108. 908 Charge to tax on profits from disposals of know-how
  1109. 909 Exceptions to charge under section 908
  1110. 910 Profits charged under section 908
  1111. 911 Overview of Chapter
  1112. 912 Charge to tax on profits from sales of patent rights
  1113. 913 Profits charged under section 912
  1114. 914 UK resident companies: proceeds of sale not received in instalments
  1115. 915 UK resident companies: proceeds of sale received in instalments
  1116. 916 Non-UK resident companies: proceeds of sale not received in instalments
  1117. 917 Non-UK resident companies: proceeds of sale received in instalments
  1118. 918 Winding up of a body corporate
  1119. 919 Deduction of tax from payments to non-UK resident companies
  1120. 920 Adjustments where tax has been deducted
  1121. 921 Licences connected with patents
  1122. 922 Rights to acquire future patent rights
  1123. 923 Sums paid for Crown use etc treated as paid under licence
  1124. 924 Relief for expenses: patent income
  1125. 925 How relief is given under section 924
  1126. 926 Contributions to expenditure
  1127. 927 Contributions not made by public bodies nor eligible for tax relief
  1128. 928 Exchanges
  1129. 929 Apportionment where property sold together
  1130. 930 Questions about apportionments affecting two or more persons
  1131. 931 Meaning of “capital sums” etc
  1132. 931A Charge to tax on distributions received
  1133. 931B Exemption from charge to tax
  1134. 931C Meaning of “qualifying territory”
  1135. 931CA Further exemption where distribution received from CFC
  1136. 931D Exemption from charge to tax
  1137. 931E Distributions from controlled companies
  1138. 931F Distributions in respect of non-redeemable ordinary shares
  1139. 931G Distributions in respect of portfolio holdings
  1140. 931H Distributions derived from transactions not designed to reduce tax
  1141. 931I Dividends in respect of shares accounted for as liabilities
  1142. 931J Schemes involving manipulation of controlled company rules
  1143. 931K Schemes involving quasi-preference or quasi-redeemable shares
  1144. 931L Schemes involving manipulation of portfolio holdings rule
  1145. 931M Schemes in the nature of loan relationships
  1146. 931N Schemes involving distributions for which deductions are given
  1147. 931O Schemes involving payments for distributions
  1148. 931P Schemes involving payments not on arm's length terms
  1149. 931Q Schemes involving diversion of trade income
  1150. 931R Election that distribution should not be exempt
  1151. 931RA Chargeable gains
  1152. 931S Meaning of “small company”
  1153. 931T Meaning of “payer”, “recipient” and “relevant person”
  1154. 931U Meaning of “ordinary share” and “redeemable”
  1155. 931V Meaning of “scheme” and “tax advantage scheme”
  1156. 931W Provisions which must be given priority over this Part
  1157. 932 Overview of Part
  1158. 933 Charge to tax on dividends of non-UK resident companies
  1159. 934 Charge to tax on estate income
  1160. 935 Absolute, limited and discretionary interests
  1161. 936 Meaning of “UK estate” and “foreign estate”
  1162. 937 Absolute interests in residue
  1163. 938 Meaning of “the administration period”, “the final accounting period” and “the final tax year”
  1164. 939 Limited interests in residue
  1165. 940 Discretionary interests in residue
  1166. 941 UK estates
  1167. 942 Foreign estates
  1168. 943 Absolute interests
  1169. 944 Limited interests
  1170. 945 Discretionary interests
  1171. 946 Applicable rate for grossing up basic amounts of estate income
  1172. 947 Aggregate income of the estate
  1173. 948 Assumed income entitlement
  1174. 949 Residuary income of the estate
  1175. 950 Shares of residuary income of estate
  1176. 951 Reduction in share of residuary income of estate
  1177. 952 Applicable rate for determining assumed income entitlement (UK estates)
  1178. 953 Introduction
  1179. 954 Successive absolute interests
  1180. 955 Assumed income entitlement of holder of absolute interest following limited interest
  1181. 956 Payments in respect of limited interests followed by absolute interests
  1182. 957 Holders of limited interests
  1183. 958 Basic amount of estate income: successive limited interests
  1184. 959 Apportionments
  1185. 960 Relief in respect of tax relating to absolute interests
  1186. 961 Relief in respect of tax relating to limited or discretionary interests
  1187. 961A Meaning of “the relevant tax year”
  1188. 962 Income from which basic amounts are treated as paid
  1189. 962A Income from which sums within section 951(1)(b) are treated as paid
  1190. 963 Income treated as bearing income tax
  1191. 964 Transfers of assets etc treated as payments
  1192. 965 Assessments, adjustments and claims after the administration period
  1193. 966 Power to obtain information from personal representatives and beneficiaries
  1194. 967 Statements relating to estate income
  1195. 968 Meaning of “personal representatives”
  1196. 969 Charge to tax on income from holding an office
  1197. 970 Rule restricting deductions for bad debts
  1198. 971 Overview of Chapter
  1199. 972 Charge to tax under this Chapter
  1200. 973 Amount of income treated as received
  1201. 974 Charge to tax under this Chapter
  1202. 975 Meaning of “foreign holdings” etc
  1203. 976 Overview of Chapter
  1204. 977 Charge to tax on annual payments not otherwise charged
  1205. 978 Exemption for payments by persons liable to pool betting duty
  1206. 979 Charge to tax on income not otherwise charged
  1207. 980 Exemption for commercial occupation of woodlands in UK
  1208. 981 Exemption for gains on financial futures
  1209. 982 Provisions which must be given priority over this Part
  1210. 983 Overview of Chapter
  1211. 984 Chapter to form part of SIP code etc
  1212. 985 References to a deduction being allowed to a company
  1213. 986 Treatment of receipts under Chapter
  1214. 987 Deduction for costs of setting up a Schedule 2 share incentive plan
  1215. 988 Deductions for running expenses of a Schedule 2 share incentive plan
  1216. 989 Deduction for contribution to plan trust
  1217. 990 Withdrawal of deduction under section 989
  1218. 991 Another deduction to be allowed if all acquired shares are awarded
  1219. 992 Award of shares to excluded employee
  1220. 993 Plan termination notice
  1221. 994 Deduction for providing free or matching shares
  1222. 995 Deduction for additional expense in providing partnership shares
  1223. 996 Shares excluded from sections 994 and 995
  1224. 997 No deduction for expenses in providing dividend shares
  1225. 998 Withdrawal of deductions if share incentive plan ceases to be a Schedule 2 share incentive plan
  1226. 999 Deduction for costs of setting up SAYE option scheme or CSOP scheme
  1227. 1000 Deduction for costs of setting up employee share ownership trust
  1228. 1001 Overview of Part
  1229. 1002 “Employment”
  1230. 1003 “Shares” etc
  1231. 1004 Groups, consortiums and commercial associations of companies
  1232. 1005 Other definitions
  1233. 1006 Overview of Chapter
  1234. 1007 Basic requirements for relief under Chapter 2
  1235. 1007A Application of Chapter in relation to employees of overseas companies who work for companies in the UK
  1236. 1008 Conditions relating to shares acquired
  1237. 1009 Conditions relating to employee's income tax position
  1238. 1010 Calculation of relief if shares are neither restricted nor convertible
  1239. 1011 Calculation of relief if shares are restricted or convertible
  1240. 1012 Reduction in amount of relief
  1241. 1013 How the relief is given
  1242. 1014 Overview of Chapter
  1243. 1015 Basic requirements for relief under Chapter 3
  1244. 1015A Application of Chapter: employees of overseas companies who take up employment with a UK company
  1245. 1015B Application of Chapter in relation to employees of overseas companies who work for companies in the UK
  1246. 1016 Conditions relating to shares acquired
  1247. 1017 Condition relating to employee's income tax position
  1248. 1018 Calculation of relief if shares are neither restricted nor convertible
  1249. 1019 Calculation of relief if shares are restricted or convertible
  1250. 1020 Reduction in amount of relief
  1251. 1021 How the relief is given
  1252. 1022 Takeover of company whose shares are subject to option
  1253. 1023 Supplementary provision for purposes of section 1022
  1254. 1024 Transfer of qualifying business by group transfers
  1255. 1025 Additional relief available if shares acquired are restricted shares
  1256. 1025A Application of Chapter: employees of overseas companies who take up employment with, or work for, a UK company
  1257. 1025B Application of Chapter where original relief a consequence of section 1007A, 1015A or 1015B
  1258. 1026 Relief available on occurrence of chargeable event
  1259. 1027 Relief available on death of employee
  1260. 1028 Supplementary provision for purposes of sections 1026 and 1027
  1261. 1029 Transfer of qualifying business by group transfers
  1262. 1030 Application of Chapter
  1263. 1030A Application of Chapter: employees of overseas companies who take up employment with, or work for, a UK company
  1264. 1030B Application of Chapter where original relief a consequence of section 1007A, 1015A or 1015B
  1265. 1031 Additional relief available if shares acquired are convertible shares etc
  1266. 1032 Meaning of “chargeable event”
  1267. 1033 Relief available on occurrence of chargeable event
  1268. 1034 Relief available following death of employee
  1269. 1035 Supplementary provision for purposes of sections 1033 and 1034
  1270. 1036 Transfer of qualifying business by group transfers
  1271. 1037 Priority of Chapter 1 of Part 11
  1272. 1038 Exclusion of other deductions
  1273. 1038A Exclusion of deductions for share options: shares not acquired
  1274. 1038B Employee shareholder shares
  1275. 1039 Overview of Part
  1276. 1040 No overlapping claims under Chapters 1A and 2
  1277. 1040ZA Restriction on claiming other tax reliefs
  1278. 1040A R&D expenditure credits
  1279. 1041 “Research and development”
  1280. 1042 “Relevant research and development”
  1281. 1042A Overview of Chapter
  1282. 1042B Entitlement to credit
  1283. 1042C Claiming the credit
  1284. 1042D Qualifying expenditure: in-house R&D
  1285. 1042E Qualifying expenditure: payments for contracted out R&D
  1286. 1042F Qualifying expenditure: activity as contractor for irrelievable client
  1287. 1042G Percentage of qualifying expenditure translated into credit
  1288. 1042H Expenditure credit to count as taxable receipt
  1289. 1042I Redemption of value of expenditure credit
  1290. 1042J Treatment of deduction to comply with PAYE and NIC limit
  1291. 1042K Amount of notional tax deduction
  1292. 1042L Treatment of notional tax deduction
  1293. 1042M Priority of discharge
  1294. 1042N Amounts surrendered to other group companies
  1295. 1042O Adaptation of entitlement for certain insurance businesses
  1296. 1043 Overview of Chapter
  1297. 1044 Additional deduction in calculating profits of trade
  1298. 1045 Alternative treatment for pre-trading expenditure: deemed trading loss
  1299. 1045ZA R&D intensity condition
  1300. 1045A Requirement to make a claim notification
  1301. 1046 Relief only available where company is going concern
  1302. 1047 Elections under section 1045
  1303. 1048 Treatment of deemed trading loss under section 1045
  1304. 1049 Restriction on consortium relief
  1305. 1050 R&D threshold
  1306. 1051 Qualifying Chapter 2 expenditure
  1307. 1052 Qualifying expenditure: in-house R&D
  1308. 1053 Qualifying expenditure: payments for contracted out R&D
  1309. 1053A Qualifying expenditure: activity as contractor for irrelievable client
  1310. 1054 Entitlement to and payment of tax credit
  1311. 1054A Requirement to make a claim notification
  1312. 1055 Meaning of “Chapter 2 surrenderable loss”
  1313. 1056 Amount of trading loss which is “unrelieved”
  1314. 1057 Tax credit only available where company is going concern
  1315. 1058 Amount of tax credit
  1316. 1058A Relevant expenditure on workers
  1317. 1058B Total amount of company's PAYE and NIC liabilities
  1318. 1058C Avoiding double counting of PAYE and NIC liabilities
  1319. 1058D Exceptions to tax credit cap
  1320. 1059 Total amount of company's PAYE and NIC liabilities
  1321. 1060 Use of credit to pay corporation tax
  1322. 1061 Tax credit payment not income of company
  1323. 1062 Restriction on losses carried forward where tax credit claimed
  1324. 1062A Insurance company to be treated as large company
  1325. 1063 Additional deduction in calculating profits of trade
  1326. 1064 R&D threshold
  1327. 1065 Qualifying Chapter 3 expenditure
  1328. 1066 Expenditure on sub-contracted R&D undertaken in-house
  1329. 1067 Expenditure on sub-contracted R&D not undertaken in-house
  1330. 1068 Additional deduction in calculating profits of trade
  1331. 1069 R&D threshold
  1332. 1070 Qualifying Chapter 4 expenditure
  1333. 1071 Subsidised qualifying expenditure on in-house direct R&D
  1334. 1072 Subsidised qualifying expenditure on contracted out R&D
  1335. 1073 Capped R&D expenditure
  1336. 1074 Additional deduction in calculating profits of trade
  1337. 1075 R&D threshold
  1338. 1076 Qualifying Chapter 5 expenditure
  1339. 1077 Qualifying expenditure on in-house direct R&D
  1340. 1078 Qualifying expenditure on contracted out R&D
  1341. 1079 Qualifying expenditure on contributions to independent R&D
  1342. 1080 Entitlement to relief: I minus E basis
  1343. ...
  1344. section-1082
  1345. section-1083
  1346. section-1084
  1347. 1085 Overview of Chapter
  1348. 1086 Meaning of “qualifying R&D activity”
  1349. 1087 Deduction in calculating profits of trade
  1350. 1088 Declaration about effect of relief
  1351. 1089 SMEs: amount of deduction
  1352. 1090 Modification of section 1089 for larger SMEs
  1353. 1091 Amount of deduction
  1354. 1092 SMEs: deemed trading loss for pre-trading expenditure
  1355. 1093 Modification of section 1092 for larger SMEs
  1356. 1094 Relief only available to SME where company is going concern
  1357. 1095 Elections under section 1092
  1358. 1096 Treatment of deemed trading loss under section 1092
  1359. 1097 R&D threshold
  1360. 1098 Meaning of “qualifying Chapter 7 expenditure”
  1361. 1099 SMEs: qualifying expenditure “for” an accounting period
  1362. 1100 Qualifying expenditure “for” an accounting period
  1363. 1101 Qualifying expenditure on in-house direct R&D
  1364. 1102 Qualifying expenditure on contracted out R&D
  1365. 1103 Entitlement to and payment of tax credit
  1366. 1104 Meaning of “Chapter 7 surrenderable loss”
  1367. 1105 Amount of trading loss which is “unrelieved”
  1368. 1106 Tax credit only available where company is going concern
  1369. 1107 Amount of tax credit
  1370. 1108 Total amount of company's PAYE and NIC liabilities
  1371. 1109 Payment of tax credit
  1372. 1110 Tax credit payment not income of company
  1373. 1111 Restriction on losses carried forward where tax credit claimed
  1374. 1112 Artificially inflated claims for relief
  1375. 1112A Overview of Chapter
  1376. 1112B Cap by reference to PAYE and NIC liabilities
  1377. 1112C Calculation of relevant PAYE and NIC liabilities
  1378. 1112D Total PAYE and NIC liabilities
  1379. 1112E Exception for companies creating or managing intellectual property
  1380. 1112F Restriction of credit and relief to companies that are going concerns
  1381. 1112G Meaning of “going concern”
  1382. 1112H No credit payable if certain tax matters outstanding
  1383. 1112I Transactions aimed at obtaining credit or relief to be disregarded
  1384. 1112J Chapter 2 relief for Northern Ireland companies
  1385. 1119 “Small or medium-sized enterprise”
  1386. 1120 Qualifications to section 1119
  1387. 1120A Enterprise treated as an SME where related enterprise becomes large
  1388. 1120B Enterprise treated as an SME where acquired by an SME
  1389. 1121 “Larger SME”
  1390. 1122 “Large company”
  1391. 1123 “Staffing costs”
  1392. 1124 Staffing costs: attributable expenditure
  1393. 1125 “Software , data licences, cloud computing services or consumable items”
  1394. 1126 Software , data licences, cloud computing services or consumable items: attributable expenditure
  1395. 1126ZA Attributable expenditure: special rules for data and cloud computing
  1396. 1126A Attributable expenditure: special rules for consumable items
  1397. 1126B Attributable expenditure: further provision
  1398. 1127 “Qualifying expenditure on externally provided workers”
  1399. 1128 “Externally provided worker”
  1400. 1129 Qualifying expenditure on externally provided workers: connected persons
  1401. 1130 Election for connected persons treatment
  1402. 1131 Qualifying expenditure on externally provided workers: other cases
  1403. 1131A Sections 1129 and 1131: secondary Class 1 NICS paid by company
  1404. 1132 External workers: attributable expenditure
  1405. 1132A “Qualifying earnings”
  1406. 1133 Contracted out research and development
  1407. 1134 Qualifying element of contractor payment: connected persons
  1408. 1135 Election for connected persons treatment
  1409. 1136 Qualifying element of contractor payment: other cases
  1410. 1137 Accounting periods: company not within charge to corporation tax
  1411. 1138 “Subsidised expenditure”
  1412. 1138A Externally provided workers and contractors: R&D undertaken abroad
  1413. 1138B Exempt foreign permanent establishments
  1414. 1139 “Intellectual property”
  1415. 1139A Expenditure incurred on payments
  1416. 1140 “Relevant payments to the subjects of a clinical trial”
  1417. 1140A Groups
  1418. 1141 “Payment period”
  1419. 1142 Ineligible companies
  1420. 1142A “Claim notification” and “claim notification period”
  1421. 1142B “R&D claim”
  1422. 1142C Right to payment of credit inalienable
  1423. 1142D General rule against payments of credit to nominees
  1424. 1142E Orders and regulations: ancillary provision
  1425. 1143 Overview of Part
  1426. 1144 “Qualifying land remediation expenditure”
  1427. 1145 Land “in a contaminated state”
  1428. 1145A Land “in a derelict state”
  1429. 1145B Exclusion of nuclear sites
  1430. 1146 “Relevant contaminated land remediation”
  1431. 1146A “Relevant derelict land remediation”
  1432. 1147 Deduction for capital expenditure
  1433. 1148 Election under section 1147
  1434. 1149 Additional deduction for qualifying land remediation expenditure
  1435. 1150 No relief if company responsible for contamination or dereliction or polluter has interest
  1436. 1151 Entitlement to and payment of tax credit
  1437. 1152 Meaning of “qualifying land remediation loss”
  1438. 1153 Amount of a loss which is “unrelieved”
  1439. 1154 Amount of tax credit
  1440. 1155 Payment of tax credit
  1441. 1156 Tax credit payment not income of company
  1442. 1157 Exclusion for capital gains purposes of certain expenditure
  1443. 1158 Restriction on losses carried forward where tax credit claimed
  1444. 1159 Limitation on relief under Chapter 2
  1445. 1160 Provision in respect of I minus E basis
  1446. 1161 Relief in respect of I minus E basis: ... expenses payable
  1447. 1162 Additional relief
  1448. 1163 No relief if company responsible for contamination or dereliction or polluter has interest
  1449. 1164 Entitlement to tax credit
  1450. 1165 Meaning of “qualifying BLAGAB loss”
  1451. 1166 Amount of tax credit
  1452. 1167 Payment of tax credit etc
  1453. 1168 Restriction on carrying forward expenses payable where tax credit claimed
  1454. 1169 Artificially inflated claims for relief or tax credit
  1455. 1170 “Staffing costs”
  1456. 1171 Staffing costs attributable to relevant land remediation
  1457. 1172 Expenditure on materials
  1458. 1173 Expenditure incurred because of contamination or dereliction
  1459. 1174 Sub-contractor payments
  1460. 1175 Connected sub-contractors
  1461. 1176 “Qualifying expenditure on sub-contracted land remediation”: other cases
  1462. 1177 “Subsidised expenditure”
  1463. 1178 Persons having a “relevant connection” to a company
  1464. 1178A “Major interest in land”
  1465. 1179 Other definitions
  1466. 1179A Overview of Part
  1467. 1179AA Qualifying companies and productions
  1468. 1179AB UK expenditure
  1469. 1179AC Company tax returns
  1470. 1179AD Groups
  1471. 1179AE Regulations
  1472. 1179B Election to tax qualifying production as separate trade
  1473. 1179BA Duration of separate trade
  1474. 1179BB Calculation of profits
  1475. 1179BC When costs are to be taken as incurred
  1476. 1179BD Preliminary expenditure
  1477. 1179BE Treatment of certain capital amounts as revenue
  1478. 1179BF Carrying forward of production losses
  1479. 1179BG Transfer of terminal loss to other qualifying production
  1480. 1179C Entitlement to expenditure credit
  1481. 1179CA Amount of expenditure credit
  1482. 1179CB Expenditure credit to count as taxable receipt
  1483. 1179CC Redemption of value of expenditure credit
  1484. 1179CD Treatment of notional tax deduction
  1485. 1179CE Amounts surrendered to other group companies
  1486. 1179CF Priority of discharge
  1487. 1179CG No credit payable if company in administration or liquidation
  1488. 1179CH No credit payable if certain tax matters outstanding
  1489. 1179CI Disqualifying arrangements and non-commercial transactions
  1490. 1179D Application of Chapters 2 and 3 to films and television programmes
  1491. 1179DA Meaning of “film”
  1492. 1179DB Qualifying films
  1493. 1179DC Theatrical release condition
  1494. 1179DD Meaning of “television programme”
  1495. 1179DE Qualifying television programmes
  1496. 1179DF Categories of qualifying programme
  1497. 1179DG Excluded programmes
  1498. 1179DH Broadcast condition
  1499. 1179DI Slot length and hourly cost conditions
  1500. 1179DJ British certification condition: provisional and final satisfaction
  1501. 1179DJA Films: certification as low-budget film
  1502. 1179DK Television programmes: test for certification
  1503. 1179DL Television programmes: applications for certification
  1504. 1179DM Television programmes: certification and revocation
  1505. 1179DN Disclosure of information for certification purposes
  1506. 1179DO UK expenditure condition: provisional and final satisfaction
  1507. 1179DP Meaning of “production company”
  1508. 1179DQ Qualifying co-productions and co-producers
  1509. 1179DR Expenditure that qualifies for credit
  1510. 1179DS Meaning of “core expenditure”
  1511. 1179DT Excluded expenditure: research and development and unpaid amounts
  1512. 1179DU Excluded expenditure: non-arm’s-length dealings with connected parties
  1513. 1179DV Percentage of qualifying expenditure translated into credit
  1514. 1179DW When the separate trade begins
  1515. 1179DX Costs and income of separate trade
  1516. 1179DY Accounting periods
  1517. 1179DZ Effect of move out of higher-percentage category
  1518. 1179E Production qualifying consecutively as film and television programme
  1519. 1179EA Meaning of “production activities”, “principal photography” and “animation”
  1520. 1179EB When film or programme is completed
  1521. 1179EC Special credit for visual effects
  1522. 1179F Application of Chapters 2 and 3 to video games
  1523. 1179FA Video games that are qualifying video games
  1524. 1179FB Intended supply condition
  1525. 1179FC British certification condition: provisional and final satisfaction
  1526. 1179FD Test for certification
  1527. 1179FE Applications for certification
  1528. 1179FF Certification and revocation
  1529. 1179FG Disclosure of information for certification purposes
  1530. 1179FH UK expenditure condition
  1531. 1179FI Meaning of “development company”
  1532. 1179FJ Expenditure that qualifies for credit
  1533. 1179FK Meaning of “core expenditure”
  1534. 1179FL Excluded expenditure: research and development and unpaid amounts
  1535. 1179FM Excluded expenditure: non-arm’s-length dealings with connected parties
  1536. 1179FN Percentage of qualifying expenditure translated into credit
  1537. 1179FO When the separate trade begins
  1538. 1179FP Costs and income of separate trade
  1539. 1179FQ Accounting periods
  1540. 1179FR Meaning of “development activities”
  1541. 1179FS When video game is completed
  1542. 1180 Overview of Part
  1543. 1181 “Film” etc
  1544. 1182 “Film production company”
  1545. 1183 “Film-making activities” etc
  1546. 1184 “Production expenditure”, “core expenditure” ...
  1547. 1185 “UK expenditure” etc
  1548. 1186 “Qualifying co-production” and “co-producer”
  1549. 1187 “Company tax return”
  1550. 1188 Activities of film production company treated as a separate trade
  1551. 1189 Calculation of profits or losses of separate film trade
  1552. 1190 Income from the film
  1553. 1191 Costs of the film
  1554. 1192 When costs are taken to be incurred
  1555. 1193 Pre-trading expenditure
  1556. 1194 Estimates
  1557. 1195 Availability and overview of film tax relief
  1558. 1196 Intended theatrical release
  1559. 1196A Intended release or broadcast
  1560. 1197 British film
  1561. 1198 UK expenditure
  1562. 1199 Additional deduction for qualifying expenditure
  1563. 1200 Amount of additional deduction
  1564. 1201 Film tax credit claimable if company has surrenderable loss
  1565. 1202 Surrendering of loss and amount of film tax credit
  1566. 1203 Payment in respect of film tax credit
  1567. 1204 No account to be taken of amount if unpaid
  1568. 1205 Artificially inflated claims for additional deduction or film tax credit
  1569. 1206 Confidentiality of information
  1570. 1207 Wrongful disclosure
  1571. 1208 Application of sections 1209 and 1210
  1572. 1209 Restriction on use of losses while film in production
  1573. 1210 Use of losses in later periods
  1574. 1211 Terminal losses
  1575. 1212 Introduction
  1576. 1213 Certification as a British film
  1577. 1214 The UK expenditure condition
  1578. 1215 Film tax relief on basis that film is limited-budget film
  1579. 1216 Time limit for amendments and assessments
  1580. 1216A Overview of Part
  1581. 1216AA “Television programme”
  1582. 1216AB “Relevant programme”
  1583. 1216AC Types of programme eligible to be relevant programmes
  1584. 1216AD Excluded programmes
  1585. 1216ADA Certain children's programmes not to be excluded programmes
  1586. 1216AE Television production company
  1587. 1216AF “Television production activities” etc
  1588. 1216AG “Production expenditure” and “core expenditure”
  1589. 1216AH “UK expenditure” etc
  1590. 1216AI “Qualifying co-production” and “co-producer”
  1591. 1216AJ “Company tax return”
  1592. 1216B Activities of television production company treated as a separate trade
  1593. 1216BA Calculation of profits or losses of separate programme trade
  1594. 1216BB Income from the relevant programme
  1595. 1216BC Costs of the relevant programme
  1596. 1216BD When costs are taken to be incurred
  1597. 1216BE Pre-trading expenditure
  1598. 1216BF Estimates
  1599. 1216C Availability and overview of television tax relief
  1600. 1216CA Intended for broadcast
  1601. 1216CB British programme
  1602. 1216CC Applications for certification
  1603. 1216CD Certification and withdrawal of certification
  1604. 1216CE UK expenditure
  1605. 1216CF Additional deduction for qualifying expenditure
  1606. 1216CG Amount of additional deduction
  1607. 1216CH Television tax credit claimable if company has surrenderable loss
  1608. 1216CI Surrendering of loss and amount of television tax credit
  1609. 1216CJ Payment in respect of television tax credit
  1610. 1216CK No account to be taken of amount if unpaid
  1611. 1216CL Artificially inflated claims for additional deduction or tax credit
  1612. 1216CM Confidentiality of information
  1613. 1216CN Wrongful disclosure
  1614. 1216D Application of sections 1216DA and 1216DB
  1615. 1216DA Restriction on use of losses while programme in production
  1616. 1216DB Use of losses in later periods
  1617. 1216DC Terminal losses
  1618. 1216E Introduction
  1619. 1216EA Certification as a British programme
  1620. 1216EB The UK expenditure condition
  1621. 1216EC Time limit for amendments and assessments
  1622. 1217A Overview of Part
  1623. 1217AA “Video game” etc
  1624. 1217AB Video games development company
  1625. 1217AC “Video game development activities” etc
  1626. 1217AD “Core expenditure”
  1627. 1217AE “European expenditure” etc
  1628. 1217AF “Company tax return”
  1629. 1217B Activities of video games development company treated as a separate trade
  1630. 1217BA Calculation of profits or losses of separate video game trade
  1631. 1217BB Income from the video game
  1632. 1217BC Costs of the video game
  1633. 1217BD When costs are taken to be incurred
  1634. 1217BE Estimates
  1635. 1217C Availability and overview of video games tax relief
  1636. 1217CA Intended for supply
  1637. 1217CB British video game
  1638. 1217CC Applications for certification
  1639. 1217CD Certification and withdrawal of certification
  1640. 1217CE European expenditure
  1641. 1217CF Additional deduction for qualifying expenditure
  1642. 1217CG Amount of additional deduction
  1643. 1217CH Video game tax credit claimable if company has surrenderable loss
  1644. 1217CI Surrendering of loss and amount of video game tax credit
  1645. 1217CJ Payment in respect of video game tax credit
  1646. 1217CK No account to be taken of amount if unpaid
  1647. 1217CL Artificially inflated claims for additional deduction or tax credit
  1648. 1217CM Confidentiality of information
  1649. 1217CN Wrongful disclosure
  1650. 1217D Application of sections 1217DA and 1217DB
  1651. 1217DA Restriction on use of losses while video game in development
  1652. 1217DB Use of losses in later periods
  1653. 1217DC Terminal losses
  1654. 1217E Introduction
  1655. 1217EA Certification as a British video game
  1656. 1217EB The European expenditure condition
  1657. 1217EC Time limit for amendments and assessments
  1658. 1217F Overview
  1659. 1217FA “Theatrical production”
  1660. 1217FB Productions not regarded as theatrical
  1661. 1217FC “Production company”
  1662. 1217G How a company qualifies for relief
  1663. 1217GA The commercial purpose condition
  1664. 1217GB The UK expenditure condition
  1665. 1217GC “Core expenditure”
  1666. 1217H Claim for additional deduction
  1667. 1217I Introduction to sections 1217IA to 1217IF
  1668. 1217IA Calculation of profits or losses of separate theatrical trade
  1669. 1217IB Income from the production
  1670. 1217IC Costs of the production
  1671. 1217ID When costs are taken to be incurred
  1672. 1217IE Pre-trading expenditure
  1673. 1217IF Estimates
  1674. 1217J Amount of additional deduction
  1675. 1217JA “Qualifying expenditure”
  1676. 1217K Theatre tax credit claimable if company has surrenderable loss
  1677. 1217KA Amount of surrenderable loss
  1678. 1217KB Payment in respect of theatre tax credit
  1679. 1217KC Limit on State aid
  1680. 1217KD No claim if company in administration or liquidation
  1681. 1217LA Tax avoidance arrangements
  1682. 1217LB Transactions not entered into for genuine commercial reasons
  1683. 1217M Application of sections 1217MA to 1217MC
  1684. 1217MA Restriction on use of losses before completion period
  1685. 1217MB Use of losses in the completion period
  1686. 1217MC Terminal losses
  1687. 1217N Provisional entitlement to relief
  1688. 1217NA Clawback of provisional relief
  1689. 1217O Activities involved in developing, producing, running or closing a production
  1690. 1217OA “Company tax return”
  1691. 1217OB Index
  1692. 1217P Overview
  1693. 1217PA “Orchestral concert”
  1694. 1217PB Production company
  1695. 1217Q Separate orchestral trade
  1696. 1217QA Election for concert series
  1697. 1217QB Calculation of profits or losses of separate orchestral trade
  1698. 1217QC Income from the production
  1699. 1217QD Costs of the production
  1700. 1217QE When costs are taken to be incurred
  1701. 1217QF Pre-trading expenditure
  1702. 1217QG Estimates
  1703. 1217R Overview of orchestra tax relief
  1704. 1217RA Companies qualifying for orchestra tax relief
  1705. 1217RB The UK expenditure condition
  1706. 1217RC “Core expenditure”
  1707. 1217RD Claim for additional deduction
  1708. 1217RE Amount of additional deduction
  1709. 1217RF “Qualifying expenditure”
  1710. 1217RG Orchestra tax credit claimable if company has surrenderable loss
  1711. 1217RH Amount of surrenderable loss
  1712. 1217RI Payment in respect of orchestra tax credit
  1713. 1217RJ Limit on State aid
  1714. 1217RK No account to be taken of amount if unpaid
  1715. 1217RKA No claim if company in administration or liquidation
  1716. 1217RL Tax avoidance arrangements
  1717. 1217RM Transactions not entered into for genuine commercial reasons
  1718. 1217S Application of sections 1217SA to 1217SC
  1719. 1217SA Restriction on use of losses before completion period
  1720. 1217SB Use of losses in the completion period
  1721. 1217SC Terminal losses
  1722. 1217T Provisional entitlement to relief
  1723. 1217TA Clawback of provisional relief
  1724. 1217U Interpretation
  1725. 1218ZA Overview
  1726. 1218ZAA “Exhibition”
  1727. 1218ZAB “Touring exhibition”
  1728. 1218ZAC Primary production company
  1729. 1218ZAD Secondary production company
  1730. 1218ZB Separate exhibition trade
  1731. 1218ZBA Calculation of profits or losses of separate exhibition trade
  1732. 1218ZBB Income from the production
  1733. 1218ZBC Costs of the production
  1734. 1218ZBD When costs are taken to be incurred
  1735. 1218ZBE Pre-trading expenditure
  1736. 1218ZBF Estimates
  1737. 1218ZC Overview of museums and galleries exhibition tax relief
  1738. 1218ZCA Companies qualifying for museums and galleries exhibition tax relief
  1739. 1218ZCB Interpretation of section 1218ZCA(3)(b) and (c)
  1740. 1218ZCC The UK expenditure condition
  1741. 1218ZCD “Core expenditure”
  1742. 1218ZCE Claim for additional deduction
  1743. 1218ZCF Amount of additional deduction
  1744. 1218ZCG “Qualifying expenditure”
  1745. 1218ZCH Museums and galleries exhibition tax credit claimable if company has surrenderable loss
  1746. 1218ZCI Amount of surrenderable loss
  1747. 1218ZCJ Payment in respect of museums and galleries exhibition tax credit
  1748. 1218ZCK Maximum museums and galleries exhibition tax credits payable
  1749. 1218ZCL No account to be taken of amount if unpaid
  1750. 1218ZCLA No claim if company in administration or liquidation
  1751. 1218ZCM Tax avoidance arrangements
  1752. 1218ZCN Transactions not entered into for genuine commercial reasons
  1753. 1218ZD Application of sections 1218ZDA to 1218ZDC
  1754. 1218ZDA Restriction on use of losses before completion period
  1755. 1218ZDB Use of losses in the completion period
  1756. 1218ZDC Terminal losses
  1757. 1218ZE Provisional entitlement to relief
  1758. 1218ZEA Clawback of provisional relief
  1759. 1218ZF Regulations about activities in relation to an exhibition
  1760. 1218ZFA Interpretation
  1761. 1217 Overview of Part
  1762. 1218 “Company with investment business” and “investment business”
  1763. 1218A Overview of Part
  1764. 1218B Overview of Part
  1765. 1219 Expenses of management of a company's investment business
  1766. 1220 Meaning of “unallowable purpose”
  1767. 1221 Amounts treated as expenses of management
  1768. 1222 Income from a source not charged to tax
  1769. 1223 Carrying forward expenses of management and other amounts
  1770. 1223A Exception for basic life assurance and general annuity business
  1771. 1224 Accounting period to which expenses are referable
  1772. 1225 Accounts conforming with GAAP
  1773. 1226 Accounts not conforming with GAAP
  1774. 1227 Accounts not drawn up
  1775. 1227A Management expenses in relation to salaried members of limited liability partnerships
  1776. 1228 Credits that reverse debits
  1777. 1229 Claw back of relief
  1778. 1230 Meaning of “reversal amount”
  1779. 1231 Absence of accounts
  1780. 1232 Chapter applies to amounts not otherwise relieved
  1781. 1233 Excess capital allowances
  1782. 1234 Payments for restrictive undertakings
  1783. 1235 Employees seconded to charities and educational establishments
  1784. 1236 Payroll deduction schemes
  1785. 1237 Counselling and other outplacement services
  1786. 1238 Retraining courses
  1787. 1239 Redundancy payments and approved contractual payments
  1788. 1240 Payments in respect of employment wholly in employer's business
  1789. 1241 Payments in respect of employment in more than one capacity
  1790. 1242 Additional payments
  1791. 1243 Payments made by the Government
  1792. 1244 Contributions to local enterprise organisations or urban regeneration companies
  1793. 1244A Contributions to flood and coastal erosion risk management projects
  1794. 1245 Payments to Export Credits Guarantee Department
  1795. 1246 Levies under FISMA 2000
  1796. 1247 Introduction
  1797. 1248 Expenses in connection with arrangements for securing a tax advantage
  1798. 1249 Unpaid remuneration
  1799. 1250 Unpaid remuneration: supplementary
  1800. 1251 Car ... hire
  1801. 1252 Industrial development grants
  1802. 1253 Contributions to local enterprise organisations or urban regeneration companies: disqualifying benefits
  1803. 1253A Contributions to flood and coastal erosion risk management projects: refunds etc
  1804. 1254 Repayments under FISMA 2000
  1805. 1255 Meaning of some accounting terms
  1806. 1256 Overview of Part
  1807. 1257 General provisions
  1808. 1258 Assessment of firms
  1809. 1258A Bare trusts
  1810. 1259 Calculation of firm's profits and losses
  1811. 1260 Section 1259: supplementary
  1812. 1261 Accounting periods of firms
  1813. 1262 Allocation of firm's profits or losses between partners
  1814. 1263 Profit-making period in which some partners have losses
  1815. 1264 Loss-making period in which some partners have profits
  1816. 1264A Excess profit allocation to non-individual partners etc
  1817. 1265 Apportionment of profit share between partner's accounting periods
  1818. 1266 Resident partners and double taxation agreements
  1819. 1267 Various rules for trades and property businesses
  1820. 1268 Election for spreading under Chapter 14 of Part 3
  1821. 1269 Interpretation of sections 1267 and 1268
  1822. 1270 Special provisions about farming and property income
  1823. 1271 Sale of patent rights: effect of partnership changes
  1824. 1272 Sale of patent rights: effect of later cessation of trade
  1825. 1273 Limited liability partnerships
  1826. 1273A Limited liability partnerships: salaried members
  1827. 1274 Unremittable income: introduction
  1828. 1275 Claim for relief for unremittable income
  1829. 1276 Withdrawal of relief
  1830. 1277 Income charged on withdrawal of relief after source ceases
  1831. 1278 Valuing unremittable income
  1832. 1279 Exemption of profits from securities free of tax to residents abroad (“FOTRA securities”)
  1833. 1280 Section 1279: supplementary provision
  1834. 1281 Income from savings certificates
  1835. 1282 Income from Ulster Savings Certificates
  1836. 1283 Interest from tax reserve certificates
  1837. 1284 Housing grants
  1838. 1285 UK company distributions
  1839. 1286 VAT repayment supplements
  1840. 1287 Incentives to use electronic communications
  1841. 1288 Unpaid remuneration
  1842. 1289 Unpaid remuneration: supplementary
  1843. 1290 Employee benefit contributions
  1844. 1291 Making of “employee benefit contributions”
  1845. 1292 Provision of qualifying benefits
  1846. 1293 Timing and amount of certain qualifying benefits
  1847. 1294 Provision or payment out of employee benefit contributions
  1848. 1295 Profits calculated before end of 9 month period
  1849. 1296 Interpretation of sections 1290 to 1296
  1850. 1297 Basic life assurance and general annuity business
  1851. 1298 Business entertainment and gifts
  1852. 1299 Business entertainment: exceptions
  1853. 1300 Business gifts: exceptions
  1854. 1301 Restriction of deductions for annual payments
  1855. 1301A Restriction of deductions for interest
  1856. 1301B Qualifying charitable donations
  1857. 1302 Social security contributions
  1858. 1303 Penalties, interest and VAT surcharges and interest
  1859. 1304 Crime-related payments
  1860. 1305 Dividends and other distributions
  1861. 1305A Avoidance schemes involving the transfer of corporate profits
  1862. 1305B Avoidance schemes involving certain non-derecognition liabilities
  1863. 1306 Losses calculated on same basis as miscellaneous income
  1864. 1307 Apportionment etc of miscellaneous profits and losses to accounting period
  1865. 1308 Expenditure brought into account in determining value of intangible asset
  1866. 1309 Payments treated as made to visiting performers
  1867. 1310 Orders and regulations
  1868. 1311 Apportionment to different periods
  1869. 1312 Abbreviated references to Acts
  1870. 1313 Activities in UK sector of continental shelf
  1871. 1314 Meaning of “caravan”
  1872. 1315 Claims and elections
  1873. 1316 Meaning of “connected” persons and “control”
  1874. 1317 Meaning of “farming” and related expressions
  1875. 1318 Meaning of grossing up
  1876. 1319 Other definitions
  1877. 1320 Interpretation: Scotland
  1878. 1321 Interpretation: Northern Ireland
  1879. 1322 Minor and consequential amendments
  1880. 1323 Power to make consequential provision
  1881. 1324 Power to undo changes
  1882. 1325 Transitional provisions and savings
  1883. 1326 Repeals and revocations
  1884. 1327 Index of defined expressions
  1885. 1328 Extent
  1886. 1329 Commencement
  1887. 1330 Short title
  1888. SCHEDULE 1 Minor and consequential amendments
  1889. SCHEDULE 2 Transitionals and savings
  1890. SCHEDULE 3 Repeals and revocations
  1891. SCHEDULE 4 Index of defined expressions

Proposed changes to this act

No one has proposed a change to this act yet.

1,891 provisions

1156 Tax credit payment not income of company

A payment in respect of a land remediation tax credit is not income of the company for any tax purposes.

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1157 Exclusion for capital gains purposes of certain expenditure

(1) This section applies if in an accounting period a payment is made to a company in respect of a land remediation tax credit. (2) The qualifying land remediation expenditure in respect of which the payment is made is to be treated as if it were excluded by section 39 of TCGA 1992 from the sums allowable under section 38 of that Act.

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1158 Restriction on losses carried forward where tax credit claimed

(1) For the purposes of section 62 of CTA 2010 (relief for losses made in UK property business) a company's UK property business loss for an accounting period in which it claims a land remediation tax credit to which it is entitled is treated as reduced by the amount of the surrendered loss for the period. (2) For the purposes of sections 45, 45A and 45B of CTA 2010 (relief of trading losses against future ... profits) a company's trading loss for an accounting period in which it claims a land remediation tax credit to which it is entitled is treated as reduced by the amount of the surrendered loss for the period. (3) Subsection (4) applies (instead of subsection (1)) if in an accounting period— (a) as a result of section 87(3) of FA 2012, a company's UK property business loss is treated for the purposes of section 76 of that Act as a deemed BLAGAB management expense for the accounting period, (b) an amount falls to be carried forward to a subsequent accounting period under section 73 of FA 2012 (unrelieved expenses carried forward), and (c) the company claims a land remediation tax credit for the period. (4) The amount which falls to be carried forward to a subsequent accounting period under section 73 of FA 2012 is treated as reduced by the amount of the surrendered loss for the period. (5) References in this section to “the amount of the surrendered loss” for an accounting period are to the amount of any qualifying land remediation loss in respect of which a land remediation tax credit is claimed for the period.

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1159 Limitation on relief under Chapter 2

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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1160 Provision in respect of I minus E basis

This Chapter applies if, for an accounting period, an insurance company is charged to tax in respect of its basic life assurance and general annuity business in accordance with the I - E rules.

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1161 Relief in respect of I minus E basis: ... expenses payable

(1) A company is entitled to relief for an accounting period if conditions A, B and C are met. (2) Condition A is that a major interest in land in the United Kingdom is a management asset of the company. (3) Condition B is that— (a) in the case of land in a contaminated state, the land was in a contaminated state at the time of the acquisition by the company of a major interest in the land, and (b) in the case of land in a derelict state, the land was in a derelict state throughout the period beginning with the earlier of— (i) 1 April 1998, and (ii) the date on which a major interest in the land was first acquired by the company or a person who was connected with the company. (3A) The Treasury may by order— (a) specify circumstances in which the condition in paragraph (a) of subsection (3) need not be met, or (b) replace the date for the time being specified in paragraph (b)(i) of that subsection with a later date. (3B) An order under subsection (3A) may contain incidental, supplemental, consequential and transitional provision and savings. (4) Condition C is that the company incurs qualifying land remediation expenditure in the accounting period in respect of the land .... (5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6) The relief is that the company may treat ... the qualifying Chapter 4 expenditure as expenses payable which fall to be brought into account for the accounting period at Step 1 in section 76 of FA 2012 (deduction for expenses payable). (7) For the purposes of this section land is a management asset of a company if it is— (a) an asset provided for use or used for the management of basic life assurance and general annuity business carried on by the company, or (b) an asset in respect of which expenditure is being incurred with a view to such use by the company.

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1162 Additional relief

(1) If a company is entitled to relief under section 1161 for an accounting period it is also entitled to relief under this section for the period. (2) For the company to obtain the relief it must make a claim. (3) The relief is that the company may treat 50% of the qualifying Chapter 4 expenditure for the purposes of section 76 of FA 2012 as deemed BLAGAB management expenses for the accounting period. (4) For the purposes of this Chapter “the qualifying Chapter 4 expenditure” means— (a) the company's qualifying land remediation expenditure for the accounting period, less (b) the amount (if any) of the expenditure which, for the purposes of section 76 of FA 2012, is not an ordinary BLAGAB management expense of the company referable to the accounting period as a result of the application of section 77(2)(b) of that Act.

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1163 No relief if company responsible for contamination or dereliction or polluter has interest

(1) A company is not entitled to relief under section 1161 or 1162 in respect of expenditure on land all or part of which is in a contaminated or derelict state if the land is in a contaminated or derelict state wholly or partly as a result of any thing done, or omitted to be done, at any time by— (a) the company, or (b) a person with a relevant connection to the company (see section 1178). (2) A company is not entitled to relief under this Chapter in respect of expenditure on land all or part of which is in a contaminated or derelict state if— (a) the land is in that state wholly or partly as a result of any thing done, or omitted to be done, by a person not within subsection (1), and (b) that person, or a person connected with that person, has a relevant interest in the land. (3) For the purposes of subsection (2) a person has a relevant interest in land if— (a) the person holds any interest in, right over or licence to occupy the land (including an option to acquire any such interest, right or licence in any circumstances), or (b) has disposed of any estate or interest in the land for a consideration that to any extent reflects the impact, or likely impact, on the value of the land of the remediation of its contamination or dereliction.

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1164 Entitlement to tax credit

(1) A company is entitled to a BLAGAB tax credit for an accounting period if it has a qualifying BLAGAB loss in the period (see section 1165). (2) For the company to obtain a BLAGAB tax credit in respect of all or part of the qualifying BLAGAB loss it must make a claim. (3) The amount of a BLAGAB tax credit to which the company is entitled is determined in accordance with section 1166. (4) See also section 1168, which restricts the carry forward of expenses payable where a company claims a BLAGAB tax credit.

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1165 Meaning of “qualifying BLAGAB loss”

(1) For the purposes of this Chapter a company has a “qualifying BLAGAB loss” in an accounting period (“the relevant accounting period”) if in the period— (a) it is entitled to relief under section 1161 or 1162, and (b) an amount falls to be carried forward to a subsequent accounting period under section 73 of FA 2012 as excess BLAGAB expenses. (2) In determining for the purposes of subsection (1)(b) whether there is an amount which falls to be carried forward to a subsequent accounting period under section 73 of FA 2012 as excess BLAGAB expenses, no account is to be taken of the amounts specified in subsection (3). (3) Those amounts are amounts— (a) brought forward from an earlier accounting period, and (b) taken into account in calculating for the purposes of section 73 of FA 2012 the amount of adjusted BLAGAB management expenses of the company for the relevant accounting period as a result of— (i) the previous application of section 73 or 93 of FA 2012, or (ii) the carry forward to the relevant accounting period of an amount under section 391 of this Act (surplus deficit). (4) The amount of the qualifying BLAGAB loss is— (a) the amount which falls to be carried forward as mentioned in subsection (1)(b), or (b) if less, 150% of the qualifying Chapter 4 expenditure in respect of which the relief was obtained.

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1166 Amount of tax credit

(1) The amount of the BLAGAB tax credit to which a company is entitled for an accounting period is 16% of the amount of the qualifying BLAGAB loss for the period. (2) The Treasury may by order replace the percentage for the time being specified in subsection (1) with a different percentage. (3) An order under subsection (2) may contain incidental, supplemental, consequential and transitional provision and savings.

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1167 Payment of tax credit etc

(1) The provisions mentioned in subsection (2) have effect in relation to a BLAGAB tax credit subject to the modifications set out in subsection (3). (2) The provisions referred to in subsection (1) are— section 1151(4) (payment of tax credit by officer of Revenue and Customs); section 1155 (supplementary provision about payment of tax credit); section 1156 (tax credit payment not income of company); section 1157 (qualifying expenditure excluded for capital gains purposes). (3) The modifications referred to in subsection (1) are as follows— (a) for any reference to a land remediation tax credit substitute a reference to a BLAGAB tax credit, and (b) in section 1157(2) for the reference to qualifying land remediation expenditure substitute a reference to qualifying Chapter 4 expenditure.

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1168 Restriction on carrying forward expenses payable where tax credit claimed

(1) This section applies if a company claims a BLAGAB tax credit to which it is entitled for an accounting period. (2) For the purposes of section 73 of FA 2012 the amount which may be— (a) carried forward from the accounting period under that section as excess BLAGAB expenses, and (b) brought into account in accordance with step 5 in section 76 of FA 2012, is treated as reduced by the amount of the surrendered loss for the period. (3) The “amount of the surrendered loss” for the period means the amount of the qualifying BLAGAB loss in respect of which the land remediation tax credit is claimed for the period.

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1169 Artificially inflated claims for relief or tax credit

(1) To the extent that a transaction is attributable to arrangements entered into wholly or mainly for a disqualifying purpose, it is to be disregarded for the purposes mentioned in subsection (2). (2) Those purposes are determining for an accounting period the amount of— (a) any relief to which a company is entitled under Chapter 2, (b) any land remediation tax credits to which a company is entitled under section 1151, (c) any relief to which a company carrying on basic life assurance and general annuity business is entitled under section 1161 or 1162, and (d) any BLAGAB tax credits to which such a company is entitled under section 1164. (3) Arrangements are entered into wholly or mainly for a “disqualifying purpose” if their main object, or one of their main objects, is to enable a company to obtain— (a) relief under Chapter 2 to which the company would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled, (b) a land remediation tax credit to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled, (c) relief under section 1161 or 1162 to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled, or (d) a life assurance company tax credit to which it would not otherwise be entitled or of a greater amount than that to which it would otherwise be entitled. (4) In this section “arrangements” includes any scheme, agreement or understanding, whether or not legally enforceable.

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1170 “Staffing costs”

(1) For the purposes of this Part the staffing costs of a company are amounts to which any of subsections (2) to (5) applies. (2) This subsection applies to an amount paid by the company to a director or an employee of the company which— (a) is earnings consisting of money, and (b) is paid because of the director's or employee's employment. (3) This subsection applies to an amount paid by the company to a director or an employee of the company, other than an amount paid in respect of benefits in kind, if— (a) the amount is paid in respect of expenses paid by the director or employee, and (b) the amount is paid because of the director's or employee's employment. (4) This subsection applies to secondary Class 1 national insurance contributions paid by the company. (5) This subsection applies to contributions paid by the company to a pension fund operated for the benefit of directors or employees of the company. (6) In subsection (5) “pension fund” means a scheme, fund or other arrangement established and maintained (whether in the United Kingdom or elsewhere) for the purpose of providing pension benefits. For this purpose “scheme” includes a deed, agreement or series of agreements. (7) In subsection (6) “pension benefits” means pensions, retirement annuities, allowances, lump sums, gratuities or other superannuation benefits (with or without subsidiary benefits).

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1171 Staffing costs attributable to relevant land remediation

(1) This section applies for the purposes of this Part to identify the staffing costs of a company which are attributable to relevant land remediation. (2) The costs which are so attributable are those paid to, or in respect of, directors or employees who are directly and actively engaged in relevant land remediation. (3) Subsection (4) applies if a director (“D”) or employee (“E”) is partly engaged directly and actively in relevant land remediation. (4) In that case— (a) if the time D or E spends so engaged is less than 20% of D's or E's total working time, none of the staffing costs relating to D or E is treated as attributable to relevant land remediation, (b) if the time D or E spends so engaged is more than 80% of D's or E's total working time, the whole of the staffing costs relating to D or E is treated as attributable to relevant land remediation, and (c) in any other case, the appropriate proportion of the staffing costs relating to D or E is treated as attributable to relevant land remediation. (5) Subsection (6) applies if persons provide services (such as secretarial or administrative services) in support of activities carried on by others. (6) Those persons are not, as a result of providing those services, to be treated as themselves directly and actively engaged in those activities.

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1172 Expenditure on materials

For the purposes of this Part expenditure on materials is attributable to relevant land remediation if the materials are employed directly in the relevant land remediation.

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1173 Expenditure incurred because of contamination or dereliction

(1) This section applies to identify cases in which the condition in section 1144(3) is to be treated as met (expenditure incurred because land in contaminated or derelict state). (2) If the only reason that expenditure on the land is increased is that the land is in a contaminated or derelict state, the amount by which the expenditure is increased is to be treated as expenditure meeting the condition in section 1144(3). (3) Subsection (4) applies— (a) in the case of land in a contaminated state, if the main purpose of any activities is any of those specified in section 1146(3), or (b) in the case of land in a derelict state, if the main purpose of any activities is any of those specified in section 1146A(3). (4) Expenditure on such works, operations or steps is to be treated as meeting the condition in section 1144(3). (5) This section does not affect the width of the provision made by section 1144(3).

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1174 Sub-contractor payments

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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1175 Connected sub-contractors

(1) This section applies if— (a) a company makes a sub-contractor payment, (b) the company and the sub-contractor are connected, and (c) in accordance with generally accepted accounting practice, the whole of the sub-contractor payment and all of the sub-contractor's relevant expenditure have been brought into account in determining the sub-contractor's profit or loss for a relevant period. (1A) In this section, a “sub-contractor payment” means a payment made by the company to the sub-contractor in respect of relevant land remediation contracted out by the company to the sub-contractor. (2) The amount of the sub-contractor payment which is “qualifying expenditure on connected sub-contracted land remediation” for the purposes of section 1144(5) is— (a) the entire payment, or (b) if less, an amount equal to the sub-contractor's relevant expenditure. (3) “Relevant expenditure” of the sub-contractor means expenditure that— (a) is incurred by the sub-contractor in carrying on or arranging for carrying on, on behalf of the company, the activities to which the sub-contractor payment relates, (b) is not of a capital nature, (c) is in respect of staffing costs or materials, and (d) is not subsidised. (4) “Relevant period” means a period— (a) for which accounts are drawn up for the sub-contractor, and (b) that ends not more than 12 months after the end of the company's period of account in which the sub-contractor payment is, in accordance with generally accepted accounting practice, brought into account in determining the company's profit or loss. (5) In the following sections, which apply for the purpose of determining whether a sub-contractor's expenditure meets the requirements of subsection (3)(c) and (d)— (a) section 1170 (staffing costs), and (b) section 1177 (subsidised expenditure), references to a company are to be read as references to the sub-contractor. (6) Any apportionment of expenditure of the company or the sub-contractor necessary for the purposes of this section is to be made on a just and reasonable basis.

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1176 “Qualifying expenditure on sub-contracted land remediation”: other cases

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1177 “Subsidised expenditure”

(1) For the purposes of this Part a company's expenditure is treated as subsidised to the extent that— (a) a grant or subsidy is obtained in respect of the expenditure, or (b) it is otherwise met directly or indirectly by a person other than the company. (2) For the purposes of this a grant, subsidy or payment that is not allocated to particular expenditure is to be allocated to expenditure of the recipient on a just and reasonable basis.

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1178 Persons having a “relevant connection” to a company

For the purposes of this Part a person has a “relevant connection” to a company in a case where the company's land is in a contaminated or derelict state wholly or partly as a result of any thing done, or omitted to be done, by the person if— (a) the person is or was connected to the company when any such thing is or was done, or omitted to be done, by the person, (b) the person is or was connected to the company at the time when a major interest in the land in question is or was acquired by the company, or (c) the person is or was connected to the company at any time when relevant land remediation is or was undertaken (whether by the company itself or on its behalf).

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1178A “Major interest in land”

(1) References in this Part to the acquisition of a major interest in land are to the acquisition of a freehold interest in the land or of a relevant leasehold interest in the land. (2) The reference in subsection (1) to the acquisition of a freehold interest in land is— (a) in relation to land in England and Wales, to the acquisition of an estate in fee simple absolute (whether subsisting at law or in equity), (b) in relation to land in Scotland, to the acquisition of the interest of an owner of land, and (c) in relation to land in Northern Ireland, to the acquisition of any freehold estate (whether subsisting at law or in equity). (3) The reference in subsection (1) to the acquisition of a relevant leasehold interest in land is to the acquisition by grant or assignment (or assignation) of— (a) in relation to land in England and Wales, a term of years absolute (whether subsisting at law or in equity), (b) in relation to land in Scotland, the tenant's right over or interest in a property subject to a lease, or (c) in relation to land in Northern Ireland, any leasehold estate (whether subsisting at law or in equity), in relation to which the condition in subsection (4) is met. (4) That condition is that— (a) in the case of a grant, the term of years or period of the lease is at least 7 years, and (b) in the case of an assignment (or assignation) the unexpired portion of the term or period is at least 7 years.

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1179 Other definitions

In this Part — “controlled waters”— in relation to England and Wales, has the same meaning as in Part 3 of the Water Resources Act 1991 (c. 57), in relation to Scotland, has the same meaning as in section 30A of the Control of Pollution Act 1974 (c. 40), and in relation to Northern Ireland, means water in waterways and underground strata (as defined in Article 2(2) of the Water (Northern Ireland) Order 1999 (S.I. 1999/662 (N.I. 6)), ... ... “pollution of controlled waters” means the entry into controlled waters of— any poisonous, noxious or polluting matter, or any solid waste matter, ... and “UK property business loss”, in relation to a company, means a loss incurred by the company in carrying on a UK property business.

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1179A Overview of Part

(1) This Part— (a) lays down special rules about the taxation of companies in relation to certain production activities in creative sectors, and (b) provides an entitlement to a credit in respect of expenditure on those activities. (2) In particular— (a) this Chapter makes general provision about the application of Chapters 2 and 3 and about the interpretation of this Part; (b) Chapter 2 lays down the special rules about taxation; (c) Chapter 3 provides the entitlement to credit; (d) Chapter 4 makes provision about the application of this Part to films and television programmes; (e) Chapter 5 makes provision about the application of this Part to video games.

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1179AA Qualifying companies and productions

(1) Chapters 2 and 3 apply where there is a qualifying production and a qualifying company for that production. (2) The later Chapters supply the meanings of those terms. (3) See in particular— (a) section 1179D, in relation to films and television programmes; (b) section 1179F, in relation to video games. (4) Whether a company is the qualifying company for a qualifying production (including whether the production is a qualifying production) is to be assessed separately in relation to each accounting period of the company. (5) The assessment is to be made by reference to the state of affairs at the end of that period. (6) So far as future events are relevant to the assessment, it is to be made by reference to the reasonable expectations of the company at that time. (7) Subsections (5) and (6) are subject to any provision of this Part that provides for— (a) a production no longer to be regarded as a qualifying production in an accounting period as a result of events after the end of that period ; (b) the submission of a film, television programme or video game certificate after the end of an accounting period. (8) Once a qualifying company has made an election under section 1179B(1) in respect of a qualifying production, no other company can subsequently be the qualifying company for that production. (9) In this Part, “production”, except when contained in another defined term or used to refer to the act of producing something, means— (a) a film (see section 1179DA), (b) a television programme (see section 1179DD), or (c) a video game.

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1179AB UK expenditure

(1) In this Part, “UK expenditure” means expenditure on goods or services that are used or consumed in the United Kingdom. (2) Any apportionment of expenditure for the purposes of this Part between expenditure that is and is not UK expenditure is to be made on a just and reasonable basis.

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1179AC Company tax returns

(1) In this Part, “company tax return” has the same meaning as in Schedule 18 to FA 1998 (see paragraph 3(1)). (2) Any amendment to a company tax return that must be made by virtue of this Part, and any assessment to give effect to such a requirement, can be made despite any limitation on the time within which such an amendment or assessment can normally be made.

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1179AD Groups

For the purposes of this Part, a company is in the same group as another company if those companies are in the same group for the purposes of Part 5 of CTA 2010.

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1179AE Regulations

(1) Regulations made by the Secretary of State under this Part are to be made by statutory instrument. (2) An instrument containing such regulations is subject to annulment in pursuance of a resolution of the House of Commons. (3) A power to make regulations under this Part includes the power to make incidental, supplemental, consequential and transitional provision and savings.

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1179B Election to tax qualifying production as separate trade

(1) The qualifying company for a qualifying production may elect in its company tax return for an accounting period for the production to be taxed as a separate trade. (2) The effect of such an election is that the activities of the company in relation to the production are to be treated for corporation tax purposes as a trade separate from any other activities of the company (including activities in relation to other qualifying productions). (3) In this Part— (a) that trade is called “the separate production trade”; (b) the accounting period to which the return containing the election relates is called “the opt-in period”.

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1179BA Duration of separate trade

(1) When the qualifying company is treated as beginning to carry on the separate production trade is determined by— (a) section 1179DW, in the case of a film or television programme; (b) section 1179FO, in the case of a video game. (2) If the result is that the separate production trade is treated as having been carried on in an accounting period before the opt-in period, any relevant company tax return must be amended so as to give effect to that treatment in that earlier accounting period. (3) Once a company has made an election under section 1179B(1), the activities of the company in relation to the production are to continue to be treated as a separate trade in accordance with this Chapter even if— (a) the production ceases to be a qualifying production, or (b) the company ceases to be the qualifying company for it. (4) That is the case even if the production ceases to be regarded as a qualifying production in the opt-in period as a result of events after the end of that period. (5) In the following provisions of this Chapter, “qualifying production” and “qualifying company” are accordingly capable of including productions or companies that used to be so.

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1179BB Calculation of profits

(1) The profits of the separate production trade are to be calculated in accordance with this section. (2) For the first period of account, the following are to be brought into account— (a) as a debit, the costs of the qualifying production incurred by the qualifying company to date, and (b) as a credit, the proportion of the qualifying company’s estimated total income from the qualifying production that is treated as earned at the end of that period. (3) For subsequent periods of account, the following are to be brought into account— (a) as a debit, the difference between— (i) the amount of the costs of the qualifying production incurred by the qualifying company to date, and (ii) the corresponding amount for the previous period, and (b) as a credit, the difference between— (i) the proportion of the qualifying company’s estimated total income from the qualifying production that is treated as earned at the end of that period, and (ii) the corresponding amount for the previous period. (4) The proportion of the qualifying company’s estimated total income that is treated as earned at the end of a period of account is given by— C/T×I where— C is the total of the costs of the qualifying production incurred by the qualifying company to date, T is the estimated total cost to the qualifying company of the qualifying production, and I is the qualifying company’s estimated total income from the qualifying production. (5) What counts as costs of, and income from, the qualifying production is determined by— (a) section 1179DX, in the case of a film or television programme; (b) section 1179FP, in the case of a video game. (See also section 1179CB.) (6) But nothing in this Part, except section 1179BE, allows an amount to count as costs of the qualifying production if it would not generally be allowed as a deduction in calculating the profits of a trade for corporation tax purposes. (7) Estimates for the purposes of this section must be made— (a) as at the balance sheet date for each period of account, and (b) on a just and reasonable basis taking into consideration all relevant circumstances. (8) Subsection (9) applies if a period of account of the separate production trade does not coincide with an accounting period of the qualifying company. (9) The expenditure and receipts brought into account for the period under this section, and the resulting profit or loss, are to be apportioned to accounting periods of the company for the purposes of this Part by reference to the number of days in the periods concerned.

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1179BC When costs are to be taken as incurred

(1) For the purposes of section 1179BB, costs are incurred when they are represented in the state of completion of the work in progress. (2) Accordingly— (a) payments in advance for work to be done are to be ignored until the work has been carried out, and (b) deferred payments are to be recognised to the extent that the work is represented in the state of completion. (3) But an amount that has not been paid is not an incurred cost until there is an unconditional obligation to pay it. (4) If an obligation is linked to income being earned from the qualifying production, no amount is to be brought into account in respect of the costs of the obligation unless an appropriate amount of income is or has been brought into account.

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1179BD Preliminary expenditure

(1) This section applies if, before the qualifying company began to carry on the separate production trade, it incurred expenditure on the development of the qualifying production. (2) The expenditure may be treated as expenditure of the separate production trade incurred immediately after the company began to carry on the trade. (3) If expenditure so treated has previously been taken into account for other tax purposes, any relevant company tax return must be amended accordingly.

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1179BE Treatment of certain capital amounts as revenue

(1) This section applies for corporation tax purposes in relation to the separate production trade. (2) Expenditure that— (a) counts as costs of the qualifying production, and (b) would (apart from this subsection) be regarded as of a capital nature by reason only of being incurred on the creation of an asset in the form of the qualifying production, is to be treated as expenditure of a revenue nature. (As to other capital expenditure, see section 53 and section 1179BB(6).) (3) Receipts that— (a) count as income from the qualifying production, and (b) would (apart from this subsection) be regarded as of a capital nature, are to be treated as receipts of a revenue nature.

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1179BF Carrying forward of production losses

(1) This section applies if a company makes a loss in the separate production trade in a pre-completion period (see sections 1179DY and 1179FQ). (2) The loss is not available for loss relief, except as provided in subsections (3) and (5). (3) The loss is not prevented from being carried forward under section 45B of CTA 2010 to be deducted from profits of the separate production trade in a subsequent period. (4) If the loss is so carried forward and deducted, the deduction is to be ignored for the purposes of section 269ZB of CTA 2010. (5) To the extent that the loss could be carried forward under section 45B of CTA 2010 to the completion period or a subsequent accounting period, it may instead be treated for the purposes of section 37 and Part 5 of CTA 2010 as a loss made in that period. (6) Subsection (5) does not apply to the extent that the loss is carried forward by virtue of section 1179BG. (7) In this section, “loss relief” includes any means by which a loss might be used to reduce the amount in respect of which the company, or any other person, is chargeable to tax.

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1179BG Transfer of terminal loss to other qualifying production

(1) This section applies if— (a) a company (“the principal company”) ceases to carry on the separate production trade in respect of a production, (b) the principal company could, but for the cessation of that trade, carry an amount (“the terminal loss”) forward under section 45A or 45B of CTA 2010 to an accounting period after that in which the cessation occurs, (c) when the trade ceases, either the principal company or another company in the same group carries on another separate production trade under this Chapter (“the other trade”), and (d) the ceased trade and the other trade both relate to productions that are or were qualifying productions by virtue of the same Chapter of this Part. (2) If the other trade is carried on by the principal company, the company may, by making a claim, treat the terminal loss (or part of it) as a loss made in the other trade that is carried forward under section 45B of CTA 2010. (3) If the other trade is carried on by another company— (a) the principal company may surrender the terminal loss (or part of it) to the other company, and (b) the other company may, by making a claim, elect for the surrendered amount to be treated as a loss made in the other trade that is carried forward under section 45B of CTA 2010. (4) The carrying forward of a loss by virtue of subsection (2) or (3) is to the first accounting period beginning after the cessation of the ceased trade. (5) If— (a) the other trade is no longer carried on that accounting period, (b) the company carrying on the other trade is not entitled to an expenditure credit under Chapter 3 for that accounting period in respect of the other trade, or (c) in a case within subsection (3), the other company does not make the election in relation to that accounting period, the claim under subsection (2) or the surrender under subsection (3) is to be treated as not having been made. (6) The Treasury may, in relation to surrenders or elections under subsection (3), make provision by regulations corresponding, subject to such adaptations or modifications as appear to them to be appropriate, to that made by Part 8 of Schedule 18 to the FA 1998. (7) A deduction made under section 45B of CTA 2010 by virtue of this section is to be ignored for the purposes of section 269ZB of CTA 2010. (8) The principal company is not entitled to relief under section 45F of CTA 2010 in respect of an amount surrendered under subsection (3).

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1179C Entitlement to expenditure credit

(1) The qualifying company for a qualifying production is entitled to an expenditure credit for— (a) the opt-in period, and (b) (subject to subsection (2)) any subsequent accounting period in which it continues to carry on the separate production trade. (2) If in any of those subsequent periods the production is no longer a qualifying production, or the company is no longer the qualifying company for it, the company is not entitled to an expenditure credit for the period. (3) But that does not affect the entitlement of the company for any subsequent period in which the production is once again a qualifying production or the company is once again the qualifying company for it. (4) If a production ceases to be regarded as a qualifying production in an accounting period as a result of events after the end of that period— (a) the qualifying company is no longer entitled to an expenditure credit for that period, and (b) any company tax return drawn up in reliance on such an entitlement must be amended so as to remove anything derived from that entitlement. (5) An expenditure credit to which a company is entitled may be claimed by the company in accordance with Part 9D of Schedule 18 to FA 1998.

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