Part II General Functions and Procedure

The general and subsidiary powers of the Authority

34AF1Restriction on exercise of certain powers except through a taxable body

1

The Authority may carry on specified activities for a commercial purpose only if it does so—

a

through a company that is a subsidiary of the Authority, or

b

in pursuance of an authorisation under section 38(1), through—

i

a body that is specified in section 38(2) and is within the charge to corporation tax, or

ii

a company that is a subsidiary of a body specified in section 38(2).

2

Subsection (3) applies if—

a

the Authority carries on a specified activity for a commercial purpose otherwise than as permitted by subsection (1), and

b

the activity is actually carried on by a body (whether the Authority or another) that, disregarding this section, is in respect of the carrying-on of the activity exempt from corporation tax and income tax.

3

The body mentioned in subsection (2)(b) is to be treated in respect of the carrying-on of the activity as not being a local authority for the purposes of—

a

section 984 of the Corporation Tax Act 2010 (exemption of local authorities from corporation tax),

b

section 838 of the Income Tax Act 2007 (exemption of local authorities from income tax), and

c

section 271 of the Taxation of Chargeable Gains Act 1992 (exemption of local authorities from capital gains tax).

4

In this section—

  • “company” means—

    1. a

      a company within the meaning given by section 1(1) of the Companies Act 2006, or

    2. b

      F2a registered society within the meaning of the Co-operative and Community Benefit Societies Act 2014 or a society registered or deemed to be registered under the Industrial and Provident Societies Act (Northern Ireland) 1969, and

  • “specified activity” means an activity specified in an order made by the Secretary of State with the consent of the Treasury.