PART VI COMPANY DISTRIBUTIONS, TAX CREDITS ETC
Chapter VA Foreign Income Dividends
F1 Companies: payments and receipts
246E Foreign income dividend not franked payment.
A foreign income dividend shall not constitute a distribution for the purposes of the definition of “franked payment” in section 238(1).
246F Calculation of ACT where company receives foreign income dividend.
(1)
Where in any accounting period a company receives foreign income dividends, the company shall not be liable to pay advance corporation tax in respect of foreign income dividends paid by it in that period unless the amount of the foreign income dividends paid by it in that period exceeds the amount of the foreign income dividends received by it in that period.
(2)
If in an accounting period there is such an excess, advance corporation tax shall be payable on an amount equal to the excess.
(3)
If the amount of foreign income dividends received by a company in an accounting period exceeds the amount of the foreign income dividends paid by it in that period the excess shall be carried forward to the next accounting period and treated for the purposes of this section (including any further application of this subsection) as foreign income dividends received by the company in that period.
(4)
This section shall have effect subject to section 246T and paragraph 2(6) of Schedule 23A.
(5)
Without prejudice to section 238(5), Schedule 13 shall apply for the purpose of regulating the manner in which effect is to be given to this section.
246G Information relating to foreign income dividends.
(1)
Where section 234A applies by virtue of the fact that a foreign income dividend is paid by a company, references in that section to an appropriate statement shall be construed as references to a written statement—
(a)
in such form as the Board may require,
(b)
showing the amount of the dividend paid,
(c)
showing the date of the payment, and
(d)
stating that the dividend carries no entitlement to a tax credit;
and in such a case section 234A(7) shall not apply.
(2)
In a case where—
(a)
a requirement is imposed on a company under section 234A(2) or (3) in relation to a foreign income dividend paid by it, and
(b)
the company fails to comply with the requirement,
no election may be made by the company under section 246J or 246K as regards the dividend or any part of it.
246H Power of inspector to require information.
(1)
This section applies where a return made by a company for a return period in accordance with Schedule 13 shows that the company has paid foreign income dividends in the period.
(2)
The inspector may by notice require the company to furnish him within such time (not being less than 30 days) as may be specified in the notice with such further information relating to the dividends as he may reasonably require for the purposes of any enactment relating to foreign income dividends.
(3)
Without prejudice to the generality of subsection (2) above, the notice may require information as to the persons to whom dividends are paid.