Finance Act 1998 (c. 36)

SCHEDULES

SCHEDULE 18 U.K. Company tax returns, assessments and related matters

Modifications etc. (not altering text)

C1 Sch. 18 restricted (31.7.1998) by 1988 c. 1, s. 754B(10) (as inserted (31.7.1998 with effect as mentioned in Sch. 17 para. 37 of 1998 c. 36) by 1998 c. 36, s. 113, Sch. 17 para. 11)

C2 Sch. 18 modified (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 68(c); S.I. 2005/1126, art. 2(2)(h)

C3 Sch. 18 applied (20.7.2005) by Finance (No. 2) Act 2005 (c. 22), s. 61

Part II U.K. Company tax return

Calculation of tax payable U.K.

8 (1) The amount of tax payable for an accounting period is calculated as follows. U.K.

• First step

• Calculate the corporation tax chargeable on the company’s profits:

  1

  Take the amount of the company’s profits for that period on which corporation tax is chargeable.

  2

  Apply the rate or rates of corporation tax applicable to the company.

• Second step

• Then give effect to any reliefs or set-offs available against corporation tax chargeable on profits:

  1

  Any reduction under section 13(2) [F1 or 13AA(2)] of the Taxes Act 1988 (marginal small companies’ relief).

  1A

  [F2 Any relief under Part V of Schedule 15 to the Finance Act 2000 (corporate venturing scheme: investment relief).]

[F3 1B Any relief under Part. 5 of Schedule 16 to the Finance Act 2002 (community investment tax relief)]

2 Any double taxation relief under section 788 or 790 of that Act.

3 Any set off for advance corporation tax under section 239 of that Act or under regulations made under section 32 of this Act.

• Third step

• Then add any amounts assessable or chargeable as if they were corporation tax (reduced by any reliefs specific to those amounts):

  1

  Any amount due under section 419(1) of the Taxes Act 1988 (tax on a loan or advance made by close company to a participator).

[F4 1A Any sum chargeable under section 501A(1) of that Act (supplementary charge in respect of ring fence trades).]

2 Any sum chargeable under section 747(4)(a) of that Act (tax on profits of a controlled foreign company).

• Fourth step

• Then deduct any amounts to be set off against the company’s overall tax liability for that period:

  1

  Any amount to be set off under section 7(2) or 11(3) of the Taxes Act 1988 (income tax borne by deduction).

  2

  Any amount to be set off under section 246N or 246Q of that Act (advance corporation tax paid in respect of foreign income dividend).

(2) Except as otherwise provided, references in this Schedule to the amount of tax payable by a company for an accounting period are to the amount shown in the company’s self-assessment as the amount payable.

Textual Amendments

F1 Words in Sch. 18 Pt. II para. 8(1) inserted (27.7.1999 with effect as mentioned in s. 28(6)(7) of the amending Act) by 1999 c. 16, s. 28(5)

F2 Words in Sch. 18 para. 8(1) inserted (28.7.2000 with application as mentioned in s. 63(4) of the amending Act) by 2000 c. 17, s. 63(2), Sch. 16 para. 5(2)

F3 Words in Sch. 18 para. 8(1) inserted (24.7.2002 with effect as mentioned in s. 57(4)(c) of the amending Act) by 2002 c. 23, s. 57, Sch. 17 para. 5

F4 Words in Sch. 18 para. 8(1) inserted (24.7.2002) by 2002 c. 23, s. 92(4)