Corporation Tax Act 2009

[F1 Companies qualifying for relief U.K.

Textual Amendments

F1 Pt. 15C inserted (17.7.2014 for specified purposes and with effect in accordance with Sch. 4 para. 16 of the amending Act, 22.8.2014 in so far as not already in force) by Finance Act 2014 (c. 26), Sch. 4 paras. 1, 16; S.I. 2014/2228, art. 2

1217G How a company qualifies for relief U.K.

(1) A company qualifies for relief in relation to a theatrical production if—

(a) it is the production company in relation to the production, and

(b) the commercial purpose condition (see section 1217GA) and the EEA expenditure condition (see section 1217GB) are met.

(2) There is further provision relating to subsection (1) in section 1217LA (tax avoidance arrangements).

1217GA The commercial purpose condition U.K.

(1) The “commercial purpose condition” is that at the beginning of the production phase the company intends that all, or a high proportion of, the live performances that it proposes to run will be—

(a) to paying members of the general public, or

(b) provided for educational purposes.

(2) The reference in subsection (1) to “live performances” is to be read in accordance with section 1217FA(4).

(3) A performance is not regarded as provided for educational purposes if the production company is, or is associated with, a person who—

(a) has responsibility for the beneficiaries, or

(b) is otherwise connected with the beneficiaries (for instance, by being their employer).

(4) For the purposes of subsection (3), a production company is associated with a person (“P”) if—

(a) P controls the production company, or

(b) P is a company which is controlled by the production company or by a person who also controls the production company.

(5) In this section—

• “the beneficiaries” means persons for whose benefit the performance will or may be provided;

• “control” has the same meaning as in Part 10 of CTA 2010 (see section 450 of that Act).

1217GB The EEA expenditure condition U.K.

(1) The “EEA expenditure condition” is that at least 25% of the core expenditure on the theatrical production incurred by the company is EEA expenditure.

(2) In this Part “EEA expenditure” means expenditure on goods or services that are provided from within the European Economic Area.

(3) Any apportionment of expenditure as between EEA and non-EEA expenditure for the purposes of this Part is to be made on a just and reasonable basis.

(4) The Treasury may by regulations—

(a) amend the percentage specified in subsection (1);

(b) amend subsection (2).

(5) See also sections 1217N and 1217NA (which are about the giving of relief provisionally on the basis that the EEA expenditure condition will be met).

1217GC “Core expenditure” U.K.

(1) In this Part “core expenditure”, in relation to a theatrical production, means expenditure on the activities involved in—

(a) producing the production, and

(b) closing the production.

(2) The reference in subsection (1)(a) to “expenditure on the activities involved in producing the production”—

(a) does not include expenditure on any matters not directly involved in producing the production (for instance, financing, marketing, legal services or storage);

(b) does not include expenditure on the ordinary running of the production; but expenditure incurred on or after the date of the first performance of the production to the paying general public may fall within subsection (1)(a) (for instance, if it is incurred in connection with a substantial recasting or a substantial redesign of the set).]