Finance Act 2015

113 “Accounting period” and “corresponding accounting period” U.K.

(1) In this Part references to an accounting period of a company are to an accounting period of the company for the purposes of corporation tax.

(2) Subsection (3) applies where—

(a) a non-UK resident company (“FC”) is not within the charge to corporation tax,

(b) a person, whether or not UK resident, is carrying on activity in the United Kingdom in connection with supplies of services, goods or other property made by FC in the course of a trade carried on by FC, and

(c) it is reasonable to assume that any of the activity of that person or FC (or both) is designed so as to ensure that FC does not, as a result of that person's activity, carry on that trade in the United Kingdom for the purposes of corporation tax (whether or not it is also designed to secure any commercial or other objective).

(3) For the purposes of this Part, FC is assumed to have such accounting periods for the purposes of corporation tax as it would have had if it had carried on a trade in the United Kingdom through a permanent establishment in the United Kingdom by reason of the activity of the person mentioned in subsection (2)(b).

(4) For the purposes of subsection (2)—

(a) the reference in that subsection to activity of the person includes any limitation which has been imposed or agreed in respect of that activity;

(b) where FC is a member of a partnership—

(i) a trade carried on by the partnership is to be regarded as a trade carried on by FC, and

(ii) supplies made by the partnership in the course of that trade are to be regarded as supplies made by FC in the course of that trade.

(5) Where the designated HMRC officer has insufficient information to identify, in accordance with subsection (3), the accounting periods of FC, for the purposes of this Part the officer is to determine those accounting periods to the best of the officer's information and belief.

(6) Where a company (“C1”) does not have an actual accounting period which coincides with the accounting period of another company (“the relevant accounting period”) (whether by reason of having no accounting periods or otherwise), in this Part—

(a) references to the corresponding accounting period of C1 in relation to the relevant accounting period are to the notional accounting period of C1 that would coincide with the relevant accounting period, and

(b) such apportionments as are just and reasonable are to be made to determine the income or tax liability of C1 for that corresponding accounting period.

Modifications etc. (not altering text)

C1 S. 113(1)-(5) modified (18.11.2015) by Finance (No. 2) Act 2015 (c. 33), Sch. 3 para. 17(3)