Income Tax (Trading and Other Income) Act 2005

[F1 397B Tax credits under section 397A: manufactured overseas dividends U.K.

(1) This section applies where, under section 581 of ITA 2007, a person is treated as receiving an overseas dividend by virtue of having received a manufactured overseas dividend which is representative of an overseas dividend.

(2) For the purposes of section 397A, the person is treated as receiving a relevant distribution made by a non-UK resident company F2 ... if, and only if, the manufactured overseas dividend is representative of such a distribution.

(3) References in section 397A to the grossed up distribution have effect as if they were references to the gross amount of the overseas dividend of which the manufactured overseas dividend is representative [F3 (“the original dividend”)], disregarding the amount of any overseas tax credit.

[F4 (3A) Section 397AA has effect as if—

(a) the references in subsections (2)(a), (3) and (4)(a) to the relevant distribution were to the original dividend, and

(b) the reference in subsection (2)(b) to the company that makes the relevant distribution were to the company that makes the original dividend.]

(4) In this section—

• “gross amount”, in relation to [F5 an] overseas dividend, has the same meaning as in Chapter 2 of Part 11 of ITA 2007 (manufactured payments) (see section 589 of that Act),

• “manufactured overseas dividend” and “overseas tax credit” have the same meaning as in Chapter 2 of that Part (see sections 581 and 591 of that Act), and

• “overseas dividend” has the same meaning as in that Part (see section 567 of that Act).]

Textual Amendments

F1 Ss. 397A-397C inserted (with effect in accordance with s. 34(2) of the amending Act) by Finance Act 2008 (c. 9), Sch. 12 para. 4

F2 Words in s. 397B(2) omitted (with effect in accordance with Sch. 19 para. 14 of the amending Act) by virtue of Finance Act 2009 (c. 10), Sch. 19 para. 4(2)

F3 Words in s. 397B(3) inserted (with effect in accordance with Sch. 19 para. 14 of the amending Act) by Finance Act 2009 (c. 10), Sch. 19 para. 4(3)

F4 S. 397B(3A) inserted (with effect in accordance with Sch. 19 para. 14 of the amending Act) by Finance Act 2009 (c. 10), Sch. 19 para. 4(4)

F5 Word in s. 397B(4) substituted (with effect in accordance with Sch. 19 para. 14 of the amending Act) by Finance Act 2009 (c. 10), Sch. 19 para. 4(5)