Income and Corporation Taxes Act 1988

751 Accounting periods and creditable tax U.K.

M1 (1) For the purposes of this Chapter, an accounting period of a company resident outside the United Kingdom shall begin—

(a) whenever the company comes under the control of [F1 persons] resident in the United Kingdom;

(b) whenever the company F2 . . . commences to carry on business [F3 unless an accounting period of the company has previously begun as respects which an apportionment under section 747(3) falls or has fallen to be made]; and

(c) whenever an accounting period of the company ends without the company then ceasing either to carry on business or to have any source of income whatsoever.

(2) For the purposes of this Chapter, an accounting period of a company resident outside the United Kingdom shall end if and at the time when—

(a) the company ceases to be under the control of persons resident in the United Kingdom; or

(b) the company becomes, or ceases to be, liable to tax in a territory; or

[F4 (bb) F5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

(c) the company ceases to have any source of income whatsoever;

and for the purposes of paragraph (b) above “liable to tax” means liable to tax by reason of domicile, residence or place of management.

(3) Without prejudice to subsections (1) and (2) above, subsections (3), (5) and (7) of section 12 shall apply for the purposes of this Chapter as they apply for the purposes of corporation tax, but with the omission of so much of those provisions as relates to a company coming or ceasing to be within the charge to corporation tax.

(4) Where it appears to the Board that the beginning or end of any accounting period of a company resident outside the United Kingdom is uncertain, [F6 the Board may by notice] specify as an accounting period of the company such period, not exceeding 12 months, as appears to the Board to be appropriate, and that period shall be treated for the purposes of this Chapter as an accounting period of the company unless [F7 the notice] is subsequently amended under subsection (5) below.

(5) If, on further facts coming to the knowledge of the Board after the [F8 giving of a notice under subsection (4) above], it appears to the Board that any accounting period specified in the [F9 notice] is not the true accounting period, the Board shall amend the [F9 notice] so as to specify the true period.

[F10 (5A) Any notice under subsection (4) above, and notice of any amendment of such a notice under subsection (5) above, shall be given to every person who has an assessable interest (as defined in section 749(9)) in the company in the accounting period in question.]

(6) In this Chapter, in relation to an accounting period of a controlled foreign company [F11 as regards which an apportionment under section 747(3) falls to be made], the creditable tax means the aggregate of—

(a) the amount of any relief from corporation tax in respect of income which (on the assumptions set out in Schedule 24 and assuming the company to be liable for corporation tax on the chargeable profits of that accounting period) would fall to be given to the company by virtue of any provision of Part XVIII in respect of foreign tax attributable to any income which is brought into account in determining those chargeable profits; and

(b) any amount which (on those assumptions) would fall to be set off against corporation tax on those chargeable profits by virtue of section 7(2); and

(c) the amount of any income tax or corporation tax actually charged in respect of the chargeable profits of that accounting period, less any of that tax which has been or falls to be repaid to the company, whether on the making of a claim or otherwise.

Textual Amendments

F1 1990 s.89and Sch.14 para.9 (correction of errors)—deemed always to have had effect. Previously

“the persons”.

F2 Words in s. 751(1)(b) repealed (with effect in accordance with Sch. 17 para. 37 of the repealing Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(2)(a), Sch. 27 Pt. 3(27), Note; S.I. 1998/3173, art. 2

F3 Words in s. 751(1)(b) inserted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(2)(b); S.I. 1998/3173, art. 2

F4 1990 s.67(2), (4)on and after 20March 1990.

F5 S. 751(2)(bb) repealed (retrospective to 30.11.1993) by Finance Act 1994 (c. 9), s. 251(1)(4), Sch. 26 Pt. 8, Note

F6 Words in s. 751(4) substituted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by virtue of Finance Act 1998 (c. 36), Sch. 17 para. 6(3)(a); S.I. 1998/3173, art. 2

F7 Words in s. 751(4) substituted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by virtue of Finance Act 1998 (c. 36), Sch. 17 para. 6(3)(b); S.I. 1998/3173, art. 2

F8 Words in s. 751(5) substituted (with effect in accordance with Sch. 17 para. 37 of amending Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(4)(a); S.I. 1998/3173, art. 2

F9 Words in s. 751(5) substituted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(4)(b); S.I. 1998/3173, art. 2

F10 S. 751(5A) inserted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(5); S.I. 1998/3173, art. 2

F11 Words in s. 751(6) substituted (with effect in accordance with Sch. 17 para. 37 of the amending Act) by Finance Act 1998 (c. 36), Sch. 17 para. 6(6); S.I. 1998/3173, art. 2

Modifications etc. (not altering text)

C1 S. 751(1)-(5A) applied (6.4.2007 with effect in accordance with s. 1034(1) of the affecting Act) by Income Tax Act 2007 (c. 3), s. 725(3) (with Sch. 2)

Marginal Citations

M1 Source—1984 s.86