Corporation Tax Act 2010

[F1 CHAPTER 17 U.K. Excluded trades, excluded activities and back-office activities

Textual Amendments

F1 Pt. 8B inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1

Introductory U.K.

357X Introduction U.K.

(1) This Chapter makes provision—

(a) specifying trades that are “excluded trades” for the purposes of this Part (see sections 357XA to 357XE), and

(b) specifying activities that are “excluded activities” for the purposes of this Part (see sections 357XF and 357XG).

(2) This Chapter also contains—

(a) a power to alter the meaning of “excluded trade” or “excluded activity” for the purposes of this Part (see section 357XH), and

(b) a power to make provision about the meaning of “back-office activities” for the purposes of this Part (see section 357XI).

Excluded trades U.K.

357XA Oil activities U.K.

(1) A trade is an “excluded trade” if it is a ring fence trade.

(2) In this section “ring fence trade” has the same meaning as in Part 8 (oil activities) (see section 277).

357XB Lending and investment U.K.

(1) A trade is an “excluded trade” if it consists of or includes—

(a) a lending activity, or

(b) a relevant regulated activity.

(2) But a trade is not an “excluded trade” by virtue of subsection (1) where it is carried on by an insurance company (within the meaning given by section 65 of FA 2012).

(3) In this section “lending activity” means—

(a) lending of money, including consumer credit, mortgage credit, factoring (with or without recourse), and financing of commercial transactions (including forfeiting),

(b) finance leasing (as lessor),

(c) issuing and administering means of payment,

(d) provision of guarantees or commitments to provide money,

(e) money transmission services,

(f) provision of alternative finance arrangements, or

(g) other activities carried on in connection with activities falling within any of paragraphs (a) to (f).

(4) In this section “relevant regulated activity” means an activity which is a regulated activity for the purposes of FISMA 2000 by virtue of any of the following provisions of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544)—

(a) article 5 (accepting deposits),

(b) article 14 (dealing in investments as principal),

(c) article 21 (dealing in investments as agent),

(d) article 25 (arranging deals in investments),

(e) article 40 (safeguarding and administering investments), and

(f) article 61 (entering into regulated mortgage contracts).

357XC Investment management U.K.

(1) A trade is an “excluded trade” if it consists of or includes portfolio management, or risk management, in relation to—

(a) a UCITS, or

(b) an AIF.

(2) In subsection (1)—

(a) “UCITS” has the meaning given in Article 1.2 of Directive 2009/65/EC of the European Parliament and of the Council;

(b) “AIF” has the meaning given in regulation 3 of the Alternative Investment Fund Managers Regulations 2013 (S.I. 2013/1773).

357XD Insurance: long-term business U.K.

A trade is an “excluded trade” if it consists of or includes long-term business (within the meaning given by section 63(1) of FA 2012).

357XE Re-insurance trade U.K.

(1) A trade is an “excluded trade” if it consists of re-insurance.

(2) In this Part “re-insurance” includes retrocession.

Excluded activities U.K.

357XF Re-insurance activity U.K.

The activity of effecting or carrying out re-insurance contracts is an “excluded activity”.

357XG Exploration and exploitation of UK sector of continental shelf U.K.

(1) An activity is an “excluded activity” if it is—

(a) an exploration or exploitation activity, or

(b) an activity carried on in connection with exploration or exploitation rights.

(2) In this section—

• “exploration or exploitation activity” means an activity carried on in connection with the exploration or exploitation of so much of the sea-bed and subsoil and their natural resources as is situated in the UK sector of the continental shelf;

• “exploration or exploitation rights” means rights to assets to be produced by exploration or exploitation activities or to interests in or to the benefit of such assets;

• “the UK sector of the continental shelf” means the areas designated by Order in Council under section 1(7) of the Continental Shelf Act 1964.

Powers U.K.

357XH Power to amend definition of “excluded trade” or “excluded activity” U.K.

(1) The Treasury may by regulations amend this Chapter so as to alter the meaning of “excluded trade” or “excluded activity” for the purposes of this Part.

(2) Regulations under this section may only be made if a draft of the statutory instrument containing them has been laid before, and approved by a resolution of, the House of Commons.

(3) Regulations under this section—

(a) may make different provision for different purposes;

(b) may make incidental, supplemental, consequential and transitional provision and savings.

357XI Power to make provision about meaning of “back-office activities” U.K.

(1) The Treasury may by regulations make provision about the meaning of “back-office activities” for the purposes of this Part.

(2) Regulations under this section may, in particular—

(a) specify activities that are, or are not, back-office activities, or

(b) specify circumstances in which activities are, or are not, to be regarded as back-office activities.

(3) Regulations under this section—

(a) may make different provision for different purposes;

(b) may make incidental, supplemental, consequential and transitional provision and savings.]