Corporation tax and taxation of company distributions
3.—(1) Where property, rights, liabilities and functions of a relevant port authority are transferred under Article 4 of the principal Order to a company formed in pursuance of Article 3 of that Order to be the authority’s successor company for the purposes of that Order, the company shall be treated for all purposes of corporation tax as if it were the same person as the authority.
(2) Where following the transfer to a company under Article 4 of the principal Order of property, rights, liabilities and functions of a relevant port authority securities of the company are issued or allotted to the authority in pursuance of Article 5 of that Order, the authority shall be treated for the purposes of corporation tax on chargeable gains as if the securities had been issued or allotted to the authority in consideration of the transfer.
(3) Where apart from this paragraph an allowable loss (within the meaning of the 1992 Act) would accrue to a former relevant port authority on a disposal on which levy under Article 15(1) of the principal Order is chargeable, the authority shall be treated for the purposes of corporation tax on chargeable gains as if the disposal had been made for a consideration of such amount as would secure that neither a gain nor a loss would accrue to the authority.
(4) Any share issued by a company in pursuance of Article 5 of the principal Order shall be treated for the purposes of the tax provisions relating to company distributions as if it had been issued wholly in consideration of a subscription paid to that company of an amount equal to the nominal value of the share.
(5) Any debenture issued by a company in pursuance of Article 5 of the principal Order shall be treated for the purposes of the tax provisions relating to company distributions as if it had been issued—
(a)wholly in consideration of a loan made to that company of an amount equal to the principal sum payable under the debenture; and
(b)wholly and exclusively for the purposes of the trade carried on by that company.