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Version Superseded: 16/11/2017
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Textual Amendments
F1Pt. 8B inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1
(1)This Chapter makes provision under which profits or losses of a trade carried on by a company as a partner in a Northern Ireland firm are—
(a)Northern Ireland profits or losses of the trade,
(b)mainstream profits or losses of the trade, or
(c)a combination of—
(i)profits or losses within paragraph (a), and
(ii)profits or losses within paragraph (b).
(2)This Chapter has effect for the purposes of this Part.
(3)In this Chapter “firm” has the same meaning as in CTA 2009 (see section 1257(1) of that Act).
(1)A firm is a “Northern Ireland firm” in an accounting period of the firm (“the firm's accounting period”) if—
(a)the firm carries on a qualifying partnership trade in the period, and
(b)the SME partnership condition or the large partnership condition is met.
(2)The “SME partnership condition” is that the firm—
(a)is an SME in relation to the firm's accounting period, and
(b)is a Northern Ireland employer in relation to that period.
(3)The “large partnership condition” is that the firm—
(a)is not an SME in relation to the firm's accounting period, and
(b)has a NIRE in that period.
(4)In their application to subsections (2) and (3), the provisions mentioned in subsection (5) have effect as if—
(a)references to a company were to a firm, and
(b)references to a director of a company were omitted.
(5)The provisions are—
(a)section 357KC (meaning of “SME”);
(b)section 357KD (meaning of “Northern Ireland employer”);
(c)section 357KE (Northern Ireland workforce conditions);
(d)Chapter 5 (Northern Ireland regional establishments);
(e)section 1128 of CTA 2009 (meaning of “externally provided worker”).
(6)A reference in this Chapter, in relation to a Northern Ireland firm, to “the firm's trade” is to the trade mentioned in subsection (1).
(1)“Qualifying partnership trade” means a trade carried on by a firm where the trade is not an excluded trade.
(2)If an election by a firm for the purposes of this subsection has effect, “qualifying partnership trade” also includes a trade carried on by the firm where—
(a)the trade is an excluded trade within—
(i)section 357XB (lending and investment),
(ii)section 357XC (investment management), or
(iii)section 357XE (re-insurance trade), and
(b)the trade includes any back-office activities.
(3)An election for the purposes of subsection (2)—
(a)must be made by notice to an officer of Revenue and Customs,
(b)must specify the first accounting period of the firm (“the specified accounting period”) in relation to which it is to have effect,
(c)must be made before the end of the period of 12 months beginning with the end of the specified accounting period, and
(d)if made in accordance with paragraphs (a) to (c)—
(i)has effect in relation to the specified accounting period and subsequent accounting periods, and
(ii)is irrevocable.
(4)For the meaning of “excluded trade”, and for power to make provision about the meaning of “back-office activities”, see Chapter 17.
(1)This section applies where conditions A and B are met.
(2)Condition A is that a firm is a Northern Ireland firm in an accounting period (“the firm's accounting period”) by virtue of the SME partnership condition in section 357WA.
(3)Condition B is that a partner in the firm is a company (“the corporate partner”) that is—
(a)within the charge to corporation tax in relation to the firm's trade, and
(b)an SME in relation to an accounting period of the corporate partner which—
(i)is the same as the firm's accounting period, or
(ii)overlaps (to any extent) the firm's accounting period.
(4)Section 357MA (profits or losses of trade that are Northern Ireland profits or losses etc: SMEs)—
(a)applies in relation to the profits or losses of the firm's trade for the firm's accounting period that are determined under section 1259(3) or (4) of CTA 2009 in relation to the corporate partner, but
(b)so applies only for the purpose of allocating (under Part 17 of that Act) a share of those profits or losses to an accounting period within subsection (3)(b).
(5)Further provision under which profits or losses of the firm's trade may in relation to the corporate partner be Northern Ireland profits or losses of the trade or mainstream profits or losses of the trade is contained in—
(a)Chapters 8 and 15, and
(b)CAA 2001 (see section 6E of that Act).
(6)Section 357WH makes further provision about the operation of Part 17 of CTA 2009 in cases in which the profits or losses of the firm's trade determined in relation to the corporate partner are Northern Ireland profits, Northern Ireland losses, mainstream profits or mainstream losses.
(1)This section applies where—
(a)a firm is a Northern Ireland firm in an accounting period (“the firm's accounting period”),
(b)a partner in the firm is a company (“the corporate partner”) that is within the charge to corporation tax in relation to the firm's trade, and
(c)condition A or B is met.
(2)Condition A is that the firm is not an SME in relation to the firm's accounting period.
(3)Condition B is that—
(a)the firm is an SME in relation to the firm's accounting period, and
(b)the corporate partner is not an SME in relation to an accounting period of the corporate partner which—
(i)is the same as the firm's accounting period, or
(ii)overlaps (to any extent) the firm's accounting period.
(4)Section 357NA (profits or losses of trade that are Northern Ireland profits or losses etc: large companies)—
(a)applies in relation to the profits or losses of the firm's trade for the firm's accounting period that are determined under section 1259(3) or (4) of CTA 2009 in relation to the corporate partner, but
(b)in a case in which condition B is met, so applies only for the purpose of allocating under Part 17 of that Act a share of those profits or losses to an accounting period within subsection (3)(b).
(5)Further provision under which profits or losses of the firm's trade may in relation to the corporate partner be Northern Ireland profits or losses of the trade or mainstream profits or losses of the trade is contained in—
(a)Chapters 8 and 15, and
(b)CAA 2001 (see section 6E of that Act).
(6)Section 357WH makes further provision about the operation of Part 17 of CTA 2009 in cases in which the profits or losses of the firm's trade determined in relation to the corporate partner are Northern Ireland profits, Northern Ireland losses, mainstream profits or mainstream losses.
(1)Section 357MA (profits or losses of trade that are Northern Ireland profits or losses etc: SMEs) as applied by section 357WC(4), and the other provisions of Chapter 6 so far as they apply for the purposes of section 357MA as so applied, have effect as if—
(a)references to the qualifying trade were to the firm's trade;
(b)references to the company were to the firm;
(c)references to the accounting period were to the firm's accounting period;
(d)the reference in section 357MA(1) to a qualifying trade by virtue of section 357KB(1) were to a qualifying partnership trade by virtue of section 357WB(1);
(e)the reference in section 357MA(3) to a qualifying trade by virtue of section 357KB(2) were to a qualifying partnership trade by virtue of section 357WB(2).
(2)Section 357KC (meaning of “SME”), in its application to section 357WD(2) and (3)(a), has effect as if any reference to a company were to a firm.
(3)Section 357NA (profits or losses of trade that are Northern Ireland profits or losses etc: large companies) as applied by section 357WD(4), and the other provisions of Chapter 7 so far as they apply for the purposes of section 357NA as so applied, have effect as if—
(a)references to the qualifying trade were to the firm's trade;
(b)references to the company were to the firm;
(c)references to the accounting period were to the firm's accounting period;
(d)in section 357NA(1) the reference to a qualifying trade by virtue of section 357KB(1) were to a qualifying partnership trade by virtue of section 357WB(1),
(e)in section 357NA(3) the reference to a qualifying trade by virtue of section 357KB(2) were to a qualifying partnership trade by virtue of section 357WB(2);
(f)in section 357NF(5), the reference to a UK resident company were to a UK resident firm.
Chapter 8 (intangible fixed assets) has effect in relation to a Northern Ireland firm as if—
(a)references to a qualifying trade were to a qualifying partnership trade;
(b)references to a company were to a firm;
(c)references to an accounting period of a company were to an accounting period of a firm;
(d)references to a Northern Ireland company were to a Northern Ireland firm;
(e)references to the SME condition in section 357KA were to the SME partnership condition in section 357WA;
(f)references to the large company condition in section 357KA were to the large partnership condition in section 357WA;
(g)the reference in section 357OB(1)(b) to a qualifying trade by virtue of section 357KB(1) were to a qualifying partnership trade by virtue of section 357WB(1).
Chapter 15 (profits arising from the exploitation of patents etc) has effect in relation to a Northern Ireland firm as if—
(a)except in relation to the making of elections under section 357A, references to a company were to the firm,
(b)references to a Northern Ireland company were to a Northern Ireland firm,
(c)references to the trade were to the firm's trade,
(d)the reference in section 357V(2) to an election made by the company were to an election made by a corporate partner as defined by section 357GB(1),
(e)the reference in 357V(2) to Part 8A were to Part 8A so far as relating to the corporate partner which made the election,
(f)references to an accounting period of a company were to an accounting period of the firm,
(g)the reference in section 357VB to the SME condition in section 357KA were to the SME condition in section 357WA, and
(h)references in section 357VC to the large company condition in section 357KA and to a qualifying trade by virtue of section 357KB(1) were to the large partnership condition in section 357WA and to a qualifying partnership trade by virtue of section 357WB(1).
(1)This section applies where the profits or losses of a firm's trade that are determined under section 1259(3) or (4) of CTA 2009 in relation to a company (“company A”) are—
(a)Northern Ireland profits or losses of the trade,
(b)mainstream profits or losses of the trade, or
(c)a combination of—
(i)profits or losses within paragraph (a), and
(ii)profits or losses within paragraph (b).
(2)Section 1262(1) of CTA 2009 (allocation of firm's profits or losses between partners) applies so as to allocate to company A a share of the profits or losses mentioned in subsection (1)(a) to (c).
For this purpose, in a case within subsection (1)(c), the firm's profit-sharing arrangements are treated as applying separately in relation to each of those profits or losses.
(3)In section 1263 of CTA 2009 (profit-making period in which some partners have losses)—
(a)where subsection (1) of that section applies so that company A's share of the profit of the trade is neither a profit nor a loss, that subsection applies so that company A is treated as having no Northern Ireland profit, no Northern Ireland loss, no mainstream profit and no mainstream loss;
(b)where subsection (2) of that section applies so that company A's share of the profit of the trade is reduced, that subsection applies so that any Northern Ireland profit, Northern Ireland loss, mainstream profit or mainstream loss of company A is reduced by the same proportion.
(4)In section 1264 of CTA 2009 (loss-making period in which some partners have profits)—
(a)where subsection (1) of that section applies so that company A's share of the loss of the trade is neither a profit nor a loss, that subsection applies so that company A is treated as having no Northern Ireland profit, no Northern Ireland loss, no mainstream profit and no mainstream loss;
(b)where subsection (2) of that section applies so that company A's share of the loss of the trade is reduced, that subsection applies so that any Northern Ireland profit, Northern Ireland loss, mainstream profit or mainstream loss of company A is reduced by the same proportion.]
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