F1PART 8BTrading profits taxable at the Northern Ireland rate
CHAPTER 7Northern Ireland profits and losses etc: SMEs that are not Northern Ireland employers and large companies
Northern Ireland profits or losses and mainstream profits or losses
357NANorthern Ireland profits or losses and mainstream profits or losses
(1)
Where the trade is a qualifying trade by virtue of section 357KB(1) (trade other than excluded trade), the profits or losses of the trade for the accounting period are Northern Ireland profits or Northern Ireland losses of the trade for the period to the extent that they—
(a)
do not arise from an excluded activity,
(b)
arise directly or indirectly through or from the company's NIRE, or from property or rights used by, or held by, or for, the company's NIRE, and
(c)
are attributable to the company's NIRE.
(2)
Subsection (1)—
(a)
does not apply in relation to any profits or losses of the trade that form part of the Northern Ireland profits or losses of the trade by virtue of any provision apart from this section, and
(b)
is subject to any provision apart from this section under which profits or losses of the trade are mainstream profits or losses of the trade.
(3)
Where the trade is a qualifying trade by virtue of section 357KB(2) (excluded trade with back-office activities), the profits, if any, determined under section 357NB as Northern Ireland back-office profits of the trade for the accounting period are Northern Ireland profits of the trade for the period.
(4)
The profits or losses of the trade for the accounting period are mainstream profits or mainstream losses of the trade for the period to the extent that they are not Northern Ireland profits or Northern Ireland losses by virtue of subsection (1) or (3) or any provision apart from this section.
(5)
Subsection (4) does not apply in relation to any profits or losses of the trade that form part of the mainstream profits or losses of the trade by virtue of any provision apart from this section.
(6)
Sections 357NC to 357NI contain provision for determining the amount of profits or losses of a trade that are attributable to the company's NIRE.
(7)
See also section 357LJ (investment managers: disregard of certain chargeable profits), which provides for profits of certain investment transactions to be disregarded in determining the amount of profits attributable to a NIRE.
357NBProfit imputed to Northern Ireland back-office activities
(1)
To determine for the purposes of section 357NA(3) the Northern Ireland back-office profits of the trade for the accounting period, take the following steps—
Step 1 Multiply each Northern Ireland back-office deduction by the relevant percentage.
Step 2 Add together each amount calculated under step 1.
(2)
In subsection (1)—
“Northern Ireland back-office deduction” means a deduction—
(a)
to which the company is entitled in calculating the profits of the trade for the period, and
(b)
which is in respect of back-office activities carried on in Northern Ireland;
“the relevant percentage” means 5%.
(3)
The Treasury may by regulations amend subsection (2) so as to substitute a different percentage for the percentage for the time being specified there.
(4)
Regulations under this section—
(a)
may make different provision for different purposes (including, in particular, different trades or different back-office activities);
(b)
may make incidental, supplemental, consequential and transitional provision and savings.