PART XVIII DOUBLE TAXATION RELIEF

CHAPTER II RULES GOVERNING RELIEF BY WAY OF CREDIT

Foreign dividends: onshore pooling and utilisation of eligible unrelieved foreign tax

806E Rules for carry back of relievable tax under section 806D.
(1) Where any relievable tax is to be treated as mentioned in section 806D(4)(c) or (5)(c), the rules for determining the accounting periods in question (and the amount of the relievable tax to be so treated in relation to each of them) are those set out in the following provisions of this section.
(2) Rule 1 is that the accounting periods in question must be accounting periods beginning not more than three years before the accounting period in which the relievable tax arises.
(3) Rule 2 is that the relievable tax must be so treated that—
(a) credit for, or for any remaining balance of, the relievable tax is allowed against corporation tax in respect of the single dividend arising in a later one of the accounting periods beginning as mentioned in rule 1 above,
before
(b) credit for any of the relievable tax is allowed against corporation tax in respect of the single dividend arising in any earlier such accounting period.
(4) Rule 3 is that the relievable tax must be so treated that, before allowing credit for any of the relievable tax against corporation tax in respect of the single dividend arising in any accounting period, credit for foreign tax is allowed—
(a) first for the aggregated foreign tax in respect of the single dividend arising in that accounting period, so far as not consisting of relievable tax arising in another accounting period; and
(b) then for relievable tax arising in any accounting period before that in which the relievable tax in question arises.
(5) The above rules are subject to sections 806D(6) and 806F.
(6) In this section—
“aggregated foreign tax” means aggregated underlying tax or aggregated withholding tax;
“relievable tax” means relievable underlying tax or relievable withholding tax;
“the single dividend” means—
(a) in relation to relievable underlying tax, the single related dividend; and
(b) in relation to relievable withholding tax, the single related dividend or the single unrelated dividend.
Ss. 806A-806H, 806J and cross-heading inserted (with effect in accordance with Sch. 30 para. 21(2) of the amending Act) by Finance Act 2000 (c. 17), Sch. 30 para. 21(1)