Corporation Tax Act 2010

538 Entry charge

(1) An amount of notional income calculated in accordance with section 539 (“the notional amount”) is treated as arising to a company at entry.

(2) The notional amount is treated as arising to the company’s residual business.

(3) If the company is a UK company, it is chargeable to corporation tax under the charge to corporation tax on income on the notional amount (which is accordingly charged at the rate mentioned in section 534(3)).

(4) If the company is a non-UK company, it is chargeable to income tax on the notional amount (which is accordingly charged at the basic rate in accordance with section 11 of ITA 2007).

(5) No loss, deficit, expense or allowance may be set off against the notional amount or against tax arising under this section.

(6) This section does not apply if a company—

(a) which was a member of one group UK REIT becomes a member of another group UK REIT, or

(b) which was a company UK REIT becomes a member of a group UK REIT.

(7) This section is subject to section 559 (demergers: company leaving group UK REIT).