Corporation Tax Act 2009

Chapter 3 U.K. Land remediation tax credit

Entitlement and payment U.K.

1151 Entitlement to and payment of tax credit U.K.

(1) A company is entitled to a land remediation tax credit for an accounting period if it has a qualifying land remediation loss in the period (see section 1152).

(2) For the company to obtain a land remediation tax credit in respect of all or part of the qualifying land remediation loss it must make a claim.

(3) The amount of a land remediation tax credit to which the company is entitled is determined in accordance with section 1154.

(4) If a company claims a land remediation tax credit to which it is entitled for an accounting period, an officer of Revenue and Customs must pay to the company the amount of the credit.

This is subject to section 1155.

(5) See also section 1158, which restricts the carry forward of losses where a company claims a land remediation tax credit.

1152 Meaning of “qualifying land remediation loss” U.K.

(1) For the purposes of this Chapter a company has a “qualifying land remediation loss” in an accounting period if in the period—

(a) it obtains an additional deduction under section 1149 in calculating the profits of a UK property business or a trade, and

(b) it makes a UK property business loss in the business or a trading loss in the trade.

(2) The amount of the qualifying land remediation loss is—

(a) so much of the UK property business loss or trading loss as is unrelieved (see section 1153), or

(b) if less, 150% of the qualifying land remediation expenditure in respect of which the relief was obtained.

Modifications etc. (not altering text)

C1 S. 1152 excluded by 2010 c. 4, s. 357QB (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

1153 Amount of a loss which is “unrelieved” U.K.

(1) The amount of a UK property business loss or trading loss that is “unrelieved” is the amount of the loss reduced by—

(a) any relief obtained by the company under [F1 section 62(1) to (3) of CTA 2010], or that was or could have been obtained by it making a claim under [F2 section 37(3)(a) of CTA 2010, to deduct the loss from total] profits of the same accounting period,

(b) any other relief obtained by the company in respect of the loss, including relief under [F3 section 37(3)(b) of CTA 2010 (losses deducted from] profits of an earlier accounting period), and

(c) any loss surrendered under [F4 Part 5 [F5 or Part 5A] of CTA 2010] (surrender of relief to group or consortium members).

(2) No account is to be taken for this purpose of—

(a) any UK property business losses or trading losses brought forward from an earlier accounting period under [F6 section 45[F7 , 45A, 45B] or 62(5) of CTA 2010], or

(b) any trading losses carried back from a later accounting period under [F8 section 37(3)(b) of CTA 2010] .

(3) Subsections (4) to (7) apply (instead of subsection (1)) to determine the amount of a UK property business loss that is “unrelieved” in an accounting period (“the relevant accounting period”) in a case where[F9 , as a result of section 87(3) of FA 2012, the loss is treated for the purposes of section 76 of that Act as a deemed BLAGAB management expense for the relevant accounting period.]

(4) If in the relevant accounting period no amount falls to be carried forward to a subsequent accounting period under [F10 section 73 of FA 2012] (unrelieved expenses carried forward), no amount of the UK property business loss is unrelieved.

(5) If in the relevant accounting period there is an amount which falls to be carried forward to a subsequent accounting period under [F10 section 73 of FA 2012], the amount of the UK property business loss that is unrelieved is—

(a) the amount which so falls to be carried forward, or

(b) if less, the amount of the UK property business loss.

(6) In determining for the purposes of subsection (4) or (5) whether there is an amount which falls to be carried forward to a subsequent accounting period under [F10 section 73 of FA 2012], no account is to be taken of the amounts specified in subsection (7).

(7) Those amounts are amounts—

(a) brought forward from an earlier accounting period, and

[F11 (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).]

(8) If—

(a) the company is an insurance company, and

(b) it is treated under [F12 section 86 of FA 2012] as carrying on more than one UK property business,

references in this section to a UK property business loss are to be read in accordance with [F13 section 87(4) of FA 2012] (aggregation of losses).

Textual Amendments

F1 Words in s. 1153(1)(a) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(2)(a)(i) (with Sch. 2)

F2 Words in s. 1153(1)(a) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(2)(a)(ii) (with Sch. 2)

F3 Words in s. 1153(1)(b) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(2)(b) (with Sch. 2)

F4 Words in s. 1153(1)(c) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(2)(c) (with Sch. 2)

F5 Words in s. 1153(1)(c) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 137(a)

F6 Words in s. 1153(2)(a) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(3)(a) (with Sch. 2)

F7 Words in s. 1153(2)(a) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 137(b)

F8 Words in s. 1153(2)(b) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 677(3)(b) (with Sch. 2)

F9 Words in s. 1153(3) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 193(2)

F10 Words in s. 1153(4)-(6) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 193(3)

F11 S. 1153(7)(b) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 193(4)

F12 Words in s. 1153(8)(b) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 193(5)(a)

F13 Words in s. 1153(8) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 193(5)(b)

Modifications etc. (not altering text)

C2 S. 1153 applied by 2010 c. 4, s. 357QB (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

Amount of tax credit U.K.

1154 Amount of tax credit U.K.

(1) The amount of the land remediation tax credit to which a company is entitled for an accounting period is 16% of the amount of the qualifying land remediation 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.

Modifications etc. (not altering text)

C3 S. 1154(1) excluded by 2010 c. 4, s. 357QC (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

Supplementary U.K.

1155 Payment of tax credit U.K.

(1) This section applies if a land remediation tax credit for an accounting period is payable to a company.

(2) The amount payable in respect of—

(a) the land remediation tax credit, or

(b) interest on the credit payable under section 826 of ICTA,

may be applied in discharging any liability of the company to pay corporation tax.

(3) So far as the amount is so applied, the duty of the officer of Revenue and Customs to pay the credit under section 1151(4) is discharged.

(4) Subsection (5) applies if the company's tax return for the accounting period is enquired into by an officer of Revenue and Customs.

(5) In that case—

(a) no payment in respect of the land remediation tax credit for the period need be made before the officer's enquiries are completed (see paragraph 32 of Schedule 18 to FA 1998), but

(b) an officer may make a payment on a provisional basis of such amount as the officer thinks fit.

(6) No payment need be made in respect of the land remediation tax credit if the company has outstanding PAYE and NIC liabilities for the period.

(7) A company has outstanding PAYE and NIC liabilities for an accounting period if it has not paid to an officer of Revenue and Customs any amount that it is required to pay—

(a) under PAYE regulations, or

(b) in respect of Class 1 national insurance contributions,

for payment periods ending in the accounting period.

(8) “Payment period” means a period—

(a) which ends on the 5th day of a month, and

(b) for which the company is liable to account for income tax and national insurance contributions to an officer of Revenue and Customs.

1156 Tax credit payment not income of company U.K.

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

1157 Exclusion for capital gains purposes of certain expenditure U.K.

(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.

1158 Restriction on losses carried forward where tax credit claimed U.K.

(1) For the purposes of [F14 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 [F15 [F16 sections 45, 45A and 45B] of CTA 2010] (relief of trading losses against future F17 ... 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—

[F18 (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 [F19 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 [F20 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.

Textual Amendments

F14 Words in s. 1158(1) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 678(2) (with Sch. 2)

F15 Words in s. 1158(2) substituted (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 678(3) (with Sch. 2)

F16 Words in s. 1158(2) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 138(a)

F17 Word in s. 1158(2) omitted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 138(b)

F18 S. 1158(3)(a) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 194(2)(a)

F19 Words in s. 1158(3)(b) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 194(2)(b)

F20 Words in s. 1158(4) substituted (17.7.2012) by Finance Act 2012 (c. 14), Sch. 16 para. 194(3)

Modifications etc. (not altering text)

C4 S. 1158(2) excluded by 2010 c. 4, s. 357QD (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

C5 S. 1158(5) excluded by 2010 c. 4, s. 357QD (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)