Corporation Tax Act 2010

Chapter 1 U.K. Corporate beneficiaries under trusts

Discretionary payments U.K.

610 Discretionary payments by trustees to companies U.K.

(1) This section applies if—

(a) the trustees of a settlement make a payment to a company,

(b) sections 494 and 495 of ITA 2007 (grossing up of trustees' discretionary payments etc) apply in relation to the payment,

(c) the company is chargeable to corporation tax, and

(d) the company is not excluded by subsection (2).

(2) A company is excluded if it is—

(a) a charitable company F1 ...,

(b) an eligible body as defined in section 468, or

(c) a scientific research association as defined in section 469.

(3) If this section applies—

(a) none of the following applies in relation to the payment—

(i) section 967,

(ii) section 968, and

(iii) section 952 of ITA 2007 (set-off claims),

(b) the payment is to be ignored for the purpose of calculating the company's income for corporation tax purposes, and

(c) no repayment is to be made of the amount treated under section 494 of ITA 2007 as income tax paid by the company in relation to the payment.

(4) If the company is non-UK resident, this section applies only in relation to so much (if any) of the payment as is income of the company for corporation tax purposes.

(5) “Payment” includes payment in money's worth.

Textual Amendments

F1 Words in s. 610(2)(a) omitted (with effect in accordance with art. 21 of the commencing S.I.) by virtue of Finance Act 2010 (c. 13), Sch. 6 paras. 27(5), 34(2); S.I. 2012/736, art. 21

Trustees' expenses U.K.

611 Income tax provisions to apply in relation to trustees' expenses U.K.

(1) This section applies in a case of a kind mentioned in section 499(1) of ITA 2007 (beneficiary entitled to some or all of the income arising to trustees of a settlement).

(2) In relation to the reduction of the beneficiary's income by reference to expenses of the trustees, sections 500 and 503 of ITA 2007 apply for corporation tax purposes as they apply for income tax purposes.