Part 23Company distributions
Chapter 4Special rules for distributions made by certain companies
Companies not carrying on a business
1071Companies not carrying on a business
1
This section applies if a company meets conditions A, B and C.
2
Condition A is that the company does not carry on, and has never carried on—
a
a trade, or
b
a business of holding investments.
3
Condition B is that the company does not hold, and has never held, an office.
4
Condition C is that the company is not established for purposes which include—
a
carrying on a trade,
b
carrying on a business of holding investments, or
c
holding an office.
5
The provisions of the Corporation Tax Acts relating to distributions apply to distributions made by the company only so far as the distributions are made out of—
a
profits of the company which are brought into charge to corporation tax, or
b
franked investment income.
6
In subsection (5) “profits” means income and chargeable gains.