Finance Act 1972

Set-off of losses etc. against surplus of franked investment income

15 Paragraph 14 above shall not apply for the purposes of a claim under section 254 or 255 of the Taxes Act for any accounting period beginning with 6th April 1973 ; and for the purposes of any such claim for a straddling period that paragraph shall have effect in relation to any such surplus as is there mentioned exclusive of any part thereof which—

(a) is carried forward from a year of assessment before the year 1972-73 ; or

(b) would be apportioned, under section 254(3)(a) or 255(2) of that Act as originally enacted, to an accounting period beginning before the straddling period.

16 (1) For the purposes of this paragraph " a relevant section 240 amount" means any amount which by virtue of paragraphs 14 and 15 above falls to be treated as franked investment income for the purposes of a claim for a straddling period under section 254 or 255 of the Taxes Act.

(2) Where a company has franked investment income for a straddling period which consists of or includes a relevant section 240 amount, and a surplus of franked investment income for that period falls to be reduced in consequence of a claim under section 254 or 255 of the Taxes Act—

(a) income tax at 38-75 per cent. shall be repaid to the company in respect of the relevant section 240 amount or the amount of the reduction, whichever is the less ; and

(b) the amount in respect of which income tax is to be repaid as aforesaid shall be deducted from the amount in respect of which any payment of tax credit falls to be made in consequence of the claim.

(3) Where a company makes claims under both the said sections 254 and 255 for a straddling period the total amount in respect of which income tax is repayable under this paragraph shall not exceed the relevant section 240 amount.

17 Where in consequence of a claim under section 254 or 255 of the Taxes Act in respect of a surplus of franked investment income for the year 1972-73 a company is entitled to repayment of a sum of income tax, section 90(3) of this Act shall apply as if—

(a) for the reference to payment of a sum in respect of tax credit there were substituted a reference to repayment of a sum of income tax ; and

(b) for the reference to the next accounting period there were substituted a reference to the accounting period which begins with or contains 6th April 1973.