Income and Corporation Taxes Act 1988

[F1 21A Computation of amount chargeable. U.K.

(1) Except as otherwise expressly provided, the profits of a Schedule A business are computed in the same way as the profits of a trade are computed for the purposes of Case I of Schedule D.

(2) The following provisions apply in accordance with subsection (1)—

• section 72 (apportionment);

• the provisions of Chapter V of Part IV (computational provisions relating to the Schedule D charge), except as mentioned in subsection (4) below;

• section 577 (business entertainment expenses);

• section 577A (expenditure involving crime);

• sections 579 and 580 (redundancy payments);

• [F2 section 588] (training courses for employees);

• [F3 section 589A] (counselling services for employees);

• section 73(2) of the M1 Finance Act 1988 (consideration for restrictive undertakings);

• section 43 of the M2 Finance Act [F4 1989 (Schedule D: computation)];

• F5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• F6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• sections 42 and 46(1) and (2) of the Finance Act 1998 (provisions as to computation of profits and losses);

• [F7 sections 196 to 200 of the Finance Act 2004 (registered pension schemes);

• section 246 of that Act (employer-financed retirement benefits schemes).]

(3) Section 74(1)(d) of this Act (disallowance of provisions for future repairs) applies in relation to a Schedule A business as if the reference to premises occupied for the purposes of the trade were to premises held for the purposes of the Schedule A business.

(4) The following provisions in Chapter V of Part IV of this Act do not apply, or are excepted from applying, in accordance with subsection (1)—

• F8 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• section 87 (treatment of premiums taxed as rent),

• F9 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• section 98 (tied premises: receipts and expenses treated as those of trade).

[F10 (5) Part 1 of Schedule 22 to the Finance Act 2001 (deduction for capital expenditure on remediation of contaminated land) applies in accordance with subsection (1), and the other Parts of that Schedule (further provision as to relief for remediation of contaminated land) have effect in relation to a Schedule A business in accordance with their provisions.]]

Textual Amendments

F1 Ss. 21-21B substituted (with effect as mentioned in s. 38(2)(3) of the amending Act) for s. 21 by Finance Act 1998 (c. 36), s. 38(1), Sch. 5 para. 4 (with Sch. 5 paras. 73, 76)

F2 Words in s. 21A(2) substituted (6.4.2003 with effect in accordance with s. 723(1) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), Sch. 6 para. 7(a) (with Sch. 7)

F3 Words in S. 21A(2) substituted (6.4.2003 with effect in accordance with s. 723(1) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), Sch. 6 para. 7(b) (with Sch. 7)

F4 Words in s. 21A(2) substituted (6.4.2003 with effect in accordance with s. 723(1) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), Sch. 6 para. 7(c) (with Sch. 7)

F5 Words in s. 21A(2) repealed (6.4.2006) by Finance Act 2004 (c. 12), Sch. 42 Pt. 3, Note (with Sch. 36)

F6 Words in s. 21A(2) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 12(2), Sch. 3 (with Sch. 2)

F7 Words in s. 21A(2) inserted (6.4.2006) by Finance Act 2004 (c. 12), s. 284, Sch. 35 para. 3 (with Sch. 36)

F8 Words in s. 21A(4) repealed (6.4.2005 with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 12(3)(a), Sch. 3 (with Sch. 2)

F9 Words in s. 21A(4) repealed (with effect in accordance with s. 883(1) of the repealing Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), Sch. 1 para. 12(3)(b), Sch. 3 (with Sch. 2)

F10 S. 21A(5) inserted (with effect in accordance with s. 70(1) of the amending Act) by Finance Act 2001 (c. 9), s. 70(3), Sch. 23 para. 1

Modifications etc. (not altering text)

C1 S. 21A applied (19.7.2006) by Finance Act 2006 (c. 25), s. 120(2)

C2 S. 21A applied (6.4.2008) by the Authorised Investment Funds (Tax) Regulations 2006 (S.I. 2006/964), reg. 69Z1(2) (as inserted by The Authorised Investment Funds (Tax) (Amendment) Regulations 2008 (S.I. 2008/705), regs. 1, 5)

Marginal Citations

M1 1988 c. 39.

M2 1989 c. 26.