Corporation Tax Act 2010

Chapter 5 U.K. Set off of income tax deductions against corporation tax

967 Deductions from payments received by UK resident companies U.K.

(1) Subsection (2) applies if a UK resident company receives a payment on which it bears income tax by deduction.

(2) The income tax on the payment is to be set off against any corporation tax assessable on the company for the accounting period in which the payment falls to be taken into account for corporation tax, or would fall to be so taken into account but for any exemption from corporation tax.

(3) Subsection (2) is subject to the provisions of the Corporation Tax Acts.

(4) The reference in subsection (1) to a payment received by a company—

(a) includes a reference to a payment received by another person on behalf of or in trust for the company, but

(b) does not include a reference to a payment received by the company on behalf of or in trust for another person.

[F1 (5) The reference in subsection (1) to a payment received by a company does not include a reference to a payment which is exempt from tax by virtue of any of the following—

• section 472 (gifts qualifying for gift aid relief: charitable companies);

• section 475 (gifts qualifying for gift aid relief: eligible bodies);

• [F2 section 486 (investment income and non-trading profits from loan relationships);

• section 487 (public revenue dividends);

• section 488 (certain miscellaneous income);

• section 489 (income from estates in administration);]

• section 664 (exemption for interest and gift aid income: community amateur sports clubs).]

Textual Amendments

F1 S. 967(5) inserted (with effect in accordance with Sch. 15 para. 17(2) of the amending Act) by Finance Act 2012 (c. 14), Sch. 15 para. 10(2)

F2 Words in s. 967(5) inserted (with effect in accordance with Sch. 15 para. 17(2) of the amending Act) by Finance Act 2012 (c. 14), Sch. 15 para. 10(3)

968 Deductions from payments received by non-UK resident companies U.K.

(1) Subsection (2) applies if—

(a) a non-UK resident company receives a payment on which it bears income tax by deduction, and

(b) the payment forms part of, or is to be taken into account in calculating, the company's income chargeable to corporation tax.

(2) The income tax on the payment is to be set off against any corporation tax assessable on that income for the accounting period in which the payment falls to be taken into account for corporation tax.