Finance Act 1994

219 Taxation of profits. U.K.

(1) Corporation tax for any accounting period on the profits arising from a corporate member’s underwriting business shall be computed on the profits of that accounting period.

(2) As respects the profits arising to a corporate member for any accounting period directly from its membership of one or more syndicates, or from assets forming part of a [F1 premium] trust fund—

(a) the aggregate of those profits shall be computed for tax purposes under Case I of Schedule D; and

(b) accordingly, no part of those profits shall be computed for those purposes under any other Schedule or any other Case of Schedule D.

(3) [F2 Subject to subsection (4A) below,] the profits arising to a corporate member for any accounting period—

(a) from assets forming part of an ancillary trust fund; or

(b) from assets employed by it in, or in connection with, its underwriting business,

shall be computed for tax purposes under Case I of Schedule D if, and to the extent that, they do not fall to be computed for those purposes under any other Schedule or any other Case of Schedule D.

(4) Where the profits arising for any accounting period from the assets of a corporate member’s [F1 premium] trust fund include [F3 UK distributions], subsection (2) above shall apply in relation to those distributions F4 . . . notwithstanding anything in section 11(2)(a) or 208 of the Taxes Act 1988.

[F5 (4A) Notwithstanding anything in section 11(2)(a) or 208 of the Taxes Act 1988, UK distributions in respect of any assets of a corporate member which are mentioned in paragraph (a) or (b) of subsection (3) above—

(a) shall be taken into account in computing profits of the corporate member for tax purposes; and

(b) shall be so taken into account under Case I of Schedule D (and not under any other Schedule or any other Case of Schedule D).

(4B) Section 231(1) of the Taxes Act 1988 (entitlement to tax credit) shall not apply where the distribution there mentioned is a distribution in respect of any asset of a corporate member’s [F1 premium] trust fund.

(4C) In this section “UK distributions” means dividends or other distributions of a company resident in the United Kingdom.]

(5) In section 20(2) of the Taxes Act 1988 (Schedule F), after the words “section 171 of the Finance Act 1993” there shall be inserted the words “ or section 219 of the Finance Act 1994 ”.

Textual Amendments

F1 Words in s. 219(2)(4)(4B) substituted (1.12.2001) by S.I. 2001/3629, art. 87(a)

F2 Words in s. 219(3) inserted (31.7.1997 with effect as mentioned in s. 22(7) of the amending Act) by 1997 c. 58, s. 22(2)

F3 Words in s. 219(4) substituted (31.7.1997 with effect as mentioned in s. 22(7) of the amending Act) by 1997 c. 58, s. 22(3)(a)

F4 Words in s. 219(4) repealed (31.7.1997 with effect as mentioned in s. 22(7) and the Note to Sch. 8 Pt. II(5) of the repealing Act) by 1997 c. 58, ss. 22(3)(b), 52, Sch. 8 Pt. II(5)

F5 S. 219(4A)-(4C) inserted (31.7.1997 with effect as mentioned in s. 22(7) of the amending Act) by 1997 c. 58, s. 22(4)