Textual Amendments
F1 See—Finance Act 1984 Sch.14 para.6(4)—notwithstanding anything inPart IXpayments of capital gains tax postponed underFinance Act 1984 Sch.14not to carry interest for any period before tax becomes payable underFinance Act 1984 Sch.14 para.11.Finance Act 1989 s. 124and Sch. 14 para. 5—payment by installments of capital gains tax on gifts.S.I. 1987 No. 530 (in Part III Vol. 5) regn. 11(3)—tax under assessments in relation to non-resident entertainers and sportsmen to be treated for the purposes of Part IXas income tax underSch. D.
Modifications etc. (not altering text)
C1Part IX (ss. 86-92) applied (27.7.1993 with effect in relation to the year 1993-94 and subsequent years of assessment) by 1993 c. 34, s. 122(2)(3)
(1)Corporation tax shall carry interest at the [F3rate applicable under section 178 of the Finance Act 1989]] from the date when the tax becomes due and payable (in accordance with section [F410] of the principal Act) until payment.
(2)Subsection (1) above applies even if the date when the tax becomes due and payable (as mentioned in that subsection) is a non-business day within the meaning of section 92 of the M1Bills of Exchange Act 1882.
(3)In relation to corporation tax assessed by virtue of section [F5346(2) or 347(1) of the principal Act,][F6137(4), 139(7) or 179(11) of the 1992 Act or section 96(8) of the Finance Act 1990] (which enable unpaid corporation tax assessed on a company to be assessed on other persons in certain circumstances), the reference in subsection (1) above to the date when the tax becomes due and payable is a reference to the date when it became due and payable by the company.
(4)In any case where—
(a)there is in any accounting period of a company (in this subsection referred to as “the later period”) an amount of surplus advance corporation tax, as defined in subsection (3) of section [F7239 of the principal Act], and
(b)pursuant to a claim under the said subsection (3), the whole or any part of that amount is treated for the purposes of the said section [F7239] as discharging liability for an amount of corporation tax for an earlier accounting period (in this subsection referred to as “the earlier period”), and
(c)disregarding the effect of the said subsection (3), an amount of corporation tax for the earlier period would carry interest in accordance with this section,
then, in determining the amount of interest payable under this section on corporation tax unpaid for the earlier period, no account shall be taken of any reduction in the amount of that tax which results from the said subsection (3) except so far as concerns interest for any time after the date on which any corporation tax for the later period became due and payable (as mentioned in subsection (1) above).
(5)A sum assessed on a company by such an assessment as is referred to in [F8section 252(5) of the principal Act] (recovery of payment of tax credit or interest on such a payment) shall carry interest at the [F9rate applicable under section 178 of the Finance Act 1989] from the date when the payment of tax credit or interest was made until the sum assessed is paid.
[F10(6)In any case where—
(a)on a claim under section 393A(1) of the principal Act, the whole or any part of a loss incurred in an accounting period (the “later period”) is set off for the purposes of corporation tax against profits of a preceding accounting period (the “earlier period”),
(b)the earlier period does not fall wholly within the period of twelve months immediately preceding the later period, and
(c)if the claim had not been made, an amount of corporation tax for the earlier period would carry interest in accordance with this section,
then, in determining the amount of interest payable under this section on corporation tax unpaid for the earlier period, no account shall be taken of any reduction in the amount of that tax which results from the claim, except so far as concerns interest for any time after the date on which any corporation tax for the later period became (or, as the case may be, would have become) due and payable, as mentioned in subsection (1) above.]
Textual Amendments
F2S. 87A inserted by Finance (No. 2) Act 1987 (c. 51), ss. 85, 95(2)
F3Finance Act 1989, s. 179(1)(b) and S.I. 1989/1298. Previously “prescribed rate”. And see S.I. 1989/1297 for regulations made, and interest rate set, under Finance Act 1989, s. 178
F4Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 844, Sch. 29 para. 10(4)(a). Previously “243(4)”
F5Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 844, Sch. 29 para. 10(4)(b). Previously “266(2), section 267(3C), section 277(1) or section 278(5) of the Taxes Act”.
F6Words in s. 87A(3) substituted (6.3.1992 with effect as mentioned in s. 289(1)(2) of the substituting Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 289, 290, Sch. 10 para. 2(9) (with ss. 60, 101(1), 171, 201(3))
F7Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 844, Sch. 29 para. 10(4)(c)(d). Previously “85 of the Finance Act 1972” and “85” respectively.
F8Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 844, Sch. 29 para. 10(4)(d). Previously “subsection (2) of section 102 of the Finance Act 1972”
F9Finance Act 1989, s. 179(1)(b), S.I. 1989/1298. Previously “prescribed rate”. And see S.I. 1989/1297 for regulations made and interest rate set under Finance Act 1989, s. 178
F10S. 87A(6) added (25.7.1991) by Finance Act 1991 (c. 31), s. 73(3)(4)(5), Sch. 15, para. 2
Modifications etc. (not altering text)
C2S. 87A modified (25.7.1991) by Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 438A, Sch. 19B, para. 3 (which was added (25. 7. 1991) by Finance Act 1991 (c. 31, SIF 63:1), s. 49, Sch. 8)
C3S. 87A extended (with modifications) (25.7.1991) by Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1), s. 438A Sch. 9B para. 5(6) (which was added (25.7.1991) by Finance Act 1991 (c. 31, SIF 63:1), s. 49, Sch. 8)
S. 87A applied (with modifications) (2.10.1992) by S.I. 1992/2326, reg. 6(5)(6)
Marginal Citations