PART IVU.K. PROVISIONS RELATING TO THE SCHEDULE D CHARGE

CHAPTER VU.K. COMPUTATIONAL PROVISIONS

DeductionsU.K.

[85AF1Costs of establishing employee share ownership trusts: relief.U.K.

(1)Subsection (2) below applies where a company incurs expenditure on establishing a qualifying employee share ownership trust.

(2)In such a case the expenditure—

(a)shall be deducted in computing for the purposes of Schedule D the profits or gains of a trade carried on by the company, or

(b)if the company is an investment company or a company in the case of which section 75 applies by virtue of section 76, shall be treated as expenses of management.

(3)In a case where—

(a)subsection (2) above applies, and

(b)the trust is established after the end of the period of nine months beginning with the day following the end of the period of account in which the expenditure is incurred,

for the purpose of applying subsection (2) above the expenditure shall be treated as incurred in the period of account in which the trust is established (and not the period of account mentioned in paragraph (b) above).

(4)In this section “qualifying employee share ownership trust” shall be construed in accordance with Schedule 5 to the Finance Act 1989.

(5)For the purposes of this section the trust is established when the deed under which it is established is executed.

(6)This section applies where the expenditure is incurred on or after 1st April 1991.]

Textual Amendments