Finance (No.2) Act 1987

Relief for unremittable income.

6 (1) Section 418 of the Taxes Act (relief for unremittable income) shall be amended as follows.

(2) At the beginning of subsection (2) there shall be inserted the words “Subject to subsection (2A) below”.

(3) After subsection (2) there shall be inserted the following subsections—

“(2A) Where the tax chargeable is corporation tax, subsection (2) above shall have effect as if—

(a) for the word “assessed”, in the second place where it occurs, there were substituted “assessable”;

(b) for the words from “on the Board ceasing” to “take account” there were substituted “on the said conditions ceasing to be satisfied as respects any part of the income, it shall be treated as income arising on the date when those conditions cease to be satisfied with respect to it and account shall be taken”; and

(c) for the words from “the date” onwards there were substituted “that date”.

(2B) Where a company becomes chargeable to corporation tax in respect of income from any source by virtue of subsections (2) and (2A) above after it has ceased to possess that source of income, the income shall be chargeable under Case VI of Schedule D.”

(4) In subsection (5) for the words “subsection (2)” there shall be substituted “subsections (2) and (2A)”.

(5) This paragraph has effect where the accounting period in which the conditions in subsection (2) of section 418 cease to be satisfied in relation to any income ends after the appointed day.