| |
where C and D have the same meanings as in paragraph (a).
|
|
Double taxation relief.
[FA80 s39D; FA95 s62]
|
450.—(1) (a) In this section—
|
| |
“appropriate inspector”, “chargeable period” and “specified return date for the chargeable period” have the same meanings respectively as in
Part 41
;
|
| |
“arrangements” and “foreign tax” have the same meanings respectively as in paragraph 1(1) of
Schedule 24
;
|
| |
“credit institution” means an undertaking whose business it is to receive deposits or other repayable funds from the public and to grant credit on its own account;
|
| |
“group relevant payment” means a relevant payment made to a relevant company by a company related to the relevant company;
|
| |
“qualified company” and “relevant trading operations” have, subject to paragraph (e), the same meanings respectively as in
section 446
;
|
| |
“relevant company” means a qualified company, other than a credit institution or a 25 per cent subsidiary of a credit institution, the relevant trading operations of which—
|
| |
(i) are wholly carried on by persons—
|
| |
(I) who are employees of the qualified company or a company related to it and who are not employees of any employer other than the qualified company or the company related to it, as the case may be, and
|
| |
(II) in respect of whom there does not exist any understanding or arrangement the purpose of which, or one of the purposes of which, is to provide for the engagement of the services of those persons, whether as employees or otherwise, should they cease to be employed by the qualified company or the company related to it, as the case may be,
|
| |
and
|
| |
(ii) are not managed or directed, whether directly or indirectly, by another qualified company other than a company related to the first-mentioned qualified company;
|
| |
“relevant foreign tax” means so much of the amount of foreign tax as—
|
| |
(i) has been deducted from relevant payments,
|
| |
(ii) would have been so deducted if the laws of the territory under which the tax was deducted prohibited the deduction of tax from such payments at a rate in excess of 10 per cent, and
|
| |
(iii) has not been repaid;
|
| |
“relevant payment” means a payment of interest which—
|
| |
(i) arises from a source within a territory in regard to which arrangements have the force of law, and
|
| |
(ii) is regarded, subject to paragraph (e), by virtue of
section 446
(10)(b) as receivable by a relevant company from the sale of goods for the purposes of relief under this Part.
|
| |
(b) For the purposes of this section, a company shall be treated as related to another company at any relevant time if at that time one of the 2 companies is a 25 per cent subsidiary of the other company, or both companies are 25 per cent subsidiaries of the same company.
|
| |
(c) For the purposes of paragraph (b), a company (in this paragraph referred to as “the subsidiary company”) shall not be deemed to be a 25 per cent subsidiary of another company (in this paragraph referred to as “the parent company”) at any time if the percentage—
|
| |
(i) of any profits, which are available for distribution to equity holders, of the subsidiary company at such time to which the parent company is beneficially entitled at such time, or
|
| |
(ii) of any assets, which are available for distribution to equity holders on a winding up, of the subsidiary company at such time to which the parent company would be beneficially entitled at such time on a winding up of the subsidiary company,
|
| |
is less than 25 per cent of such profits or assets, as the case may be, of the subsidiary company at such time, and
sections 413
,
414
,
415
and
418
shall, with any necessary modifications but without regard to
section 411
(1)(c) in so far as it relates to those sections, apply to the determination of the percentage of those profits or assets, as the case may be, to which a company is beneficially entitled as they apply to the determination for the purposes of
Chapter 5
of
Part 12
of the percentage of any such profits or assets to which a company is so entitled.
|
| |
(d) For the purposes of this section, a company shall be deemed to be a 25 per cent subsidiary of another company if and so long as not less than 25 per cent of its ordinary share capital would be treated as owned directly or indirectly by that other company if
section 9
(other than subsection (1) of that section) were to apply for the purposes of this paragraph, and, where a company (in this paragraph referred to as “that company”) would be treated for the purposes of this section as a 25 per cent subsidiary of a credit institution which is not a company, if the credit institution were a company, that company shall be so treated for those purposes.
|
| |
(e) For the purpose of this section apart from this paragraph—
|
| |
(i) a payment made to a company in the course of relevant trading operations (within the meaning of
section 445
), being a payment which is regarded by virtue of
section 445
(9)(b) as receivable from the sale of goods for the purposes of relief under this Part, shall be treated as so regarded by virtue of
section 446
(10)(b), and
|
| |
(ii) if the company is a qualified company carrying on relevant trading operations (within the meaning of
section 445
), it shall be treated as being a qualified company carrying on relevant trading operations (within the meaning of
section 446
),
|
| |
so long as the relevant trading operations (within the meaning of
section 445
) could be certified by the Minister for Finance as relevant trading operations for the purposes of
section 446
if they were carried on in the Area (within the meaning of
section 446
) rather than in the airport (within the meaning of
section 445
).
|
| |
(2) Notwithstanding paragraph 4 of
Schedule 24
but subject to subsection (3), where a relevant company elects to have the amount of the credit, which is to be allowed to the company in respect of foreign tax deducted from group relevant payments made to the company in a relevant accounting period, computed as if, for the purposes of paragraph 4 of
Schedule 24
, the amount of the corporation tax attributable to the income attributable to those group relevant payments were deemed to be increased by an amount which—
|
| |
(a) shall be allocated by the company in such amounts and to such part of that income as the company thinks fit, and
|
| |
(b) shall not exceed 35 per cent of the amount of corporation tax which—
|
| |
(i) apart from this section would be payable by the company, and
|
| |
(ii) is attributable to all relevant payments made to the company in the course of the trade in the accounting period,
|
| |
the amount of that credit shall be so computed for those purposes.
|
| |
(3) Where an election is made by a company under subsection (2) in respect of a relevant accounting period—
|
| |
(a) any credit for foreign tax deducted from group relevant payments made to the company in the accounting period shall be computed as if the amount of foreign tax deducted from those group relevant payments were the amount of relevant foreign tax comprised in that amount, and
|
| |
(b) so much of that credit as would not have been allowed to the company apart from this section shall be disregarded for the purposes of paragraph 7(3)(c) of
Schedule 24
.
|
| |
(4) (a) For the purposes of subsection (2), the amount of corporation tax which apart from this section would be payable by a company and which is attributable to relevant payments made to the company shall be an amount determined by the formula—
|
| |
A−B
|
| |
where—
|
| |
A is an amount equal to 10 per cent of the amount of the income of the company attributable to relevant payments, and
|
| |
B is the credit which apart from this section would be allowed to the company in respect of foreign tax deducted from those payments.
|
| |
(b) For the purposes of paragraph (a)—
|
| |
(i) the amount of the income of a company attributable to relevant payments made to the company in the course of a trade in a relevant accounting period shall, subject to paragraph 4(5) of
Schedule 24
, be taken to be such sum as bears to the total amount of the income of the company from the sale of goods in the course of the trade in the relevant accounting period the same proportion as those relevant payments bear to the total amount receivable by the company from the sale of goods in the course of the trade in the accounting period, and
|
| |
(ii) the total amount of income of a company from the sale of goods in the course of a trade in a relevant accounting period shall be taken to be the sum referred to in subsection (3) of
section 448
which, for the purposes of subsection (2) of that section, is to be taken to be the income of the trade for the relevant accounting period referred to in the expression “the income from the sale of those goods” in subsection (2) of that section.
|
| |
(5) Where as respects a relevant accounting period corporation tax payable by a company is by virtue of
section 448
(7) reduced by a fraction (referred to in that section as “the revised relief”), this section shall apply to the company as if the references to 10 per cent in the definition of “relevant foreign tax” in subsection (1) and in the definition of “A” in subsection (4)(a) were references to a rate per cent determined by the formula—
|
| |
C×(1−D)
|
| |
where—
|
| |
C is the rate per cent of corporation tax specified in
section 21
(1) for the financial year in which the relevant accounting period ends, and
|
| |
D is the fraction referred to in
section 448
(7) as “the revised relief”.
|
| |
(6) An election referred to in subsection (2) shall be made in writing to the appropriate inspector in relation to the company making the election on or before that company's specified return date for the chargeable period in respect of which it is making the election.
|
|
Treatment of income and gains of certain trading operations carried on in Custom House Docks Area from investments held outside the State.
[FA88 s36(4); FA97 s66(1)]
|
451.
—(1) In this section—
|
| |
“the Area” has the same meaning as it has for the purposes of
section 446
;
|
| |
“foreign life assurance business” means relevant trading operations within the meaning of
section 446
consisting of life assurance business with policy holders and annuitants who at the time such business is contracted reside outside the State and, as regards any policy issued or contract made, as the case may be, with such policy holders or annuitants in the course of such business, such policy or contract does not provide for—
|
| |
(a) the granting of any additional contractual rights, or
|
| |
(b) an option to have another policy or contract substituted for it,
|
| |
at a time when the policy holder or annuitant, as the case may be, resides in the State;
|
| |
“foreign unit trust business” means relevant trading operations within the meaning of
section 446
consisting of the management of the investments of one or more qualifying unit trusts;
|
| |
“qualifying unit trust” means a unit trust scheme—
|
| |
(a) which is a registered unit trust scheme within the meaning of the Unit Trusts Act, 1972,
|
| |
(b) the business of which—
|
| |
(i) is carried on in the Area, or
|
| |
(ii) is not so carried on but is carried on in the State and would be carried on in the Area but for circumstances outside the control of the person or persons carrying on the business,
|
| |
and
|
| |
(c) as respects which all holders of units in the scheme are persons resident outside the State;
|
| |
“tax” means income tax, corporation tax or capital gains tax, as may be appropriate.
|
| |
(2) Notwithstanding any other provision of the Tax Acts, the rate at which any tax is chargeable (before any credit is allowed for foreign tax) in respect of income arising or chargeable gains accruing from securities or possessions in any place outside the State that are investments of a foreign life assurance business or investments managed by a foreign unit trust business shall not exceed 10 per cent.
|
|
Application of
section 130
to certain interest.
[FA88 s37; FA94 s49]
|
452.
—(1) (a) In this section—
|
| |
“qualified company” and “relevant trading operations” have the same meanings as they have for the purposes of
sections 445
and
446
, but trading operations shall not be treated as relevant trading operations (within the meaning of
section 445
) if they are not trading operations which could be certified by the Minister for Finance as relevant trading operations for the purposes of
section 446
if they were carried on in the Area (within the meaning of
section 446
) rather than in the airport (within the meaning of
section 445
);
|
| |
“resident of the United States of America” has the meaning assigned to it by the Convention set out in
Schedule 25
.
|
| |
(b) For the purposes of this section, a company shall be regarded as being a resident of a territory, other than the United States of America, if it is so regarded under arrangements made with the government of that territory and having the force of law by virtue of
section 826
.
|
| |
(2) This section shall apply to so much of any interest as—
|
| |
(a) is a distribution by virtue only of
section 130
(2)(d)(iv),
|
| |
(b) is payable by a qualified company in the course of carrying on relevant trading operations and would but for
section 130
(2)(d)(iv) be deductible as a trading expense in computing the amount of the company's income from the relevant trading operations, and
|
| |
(c) is interest payable to a company which is a resident of the United States of America or of a territory with the government of which arrangements having the force of law by virtue of
section 826
have been made.
|
| |
(3) Where a company proves that this section applies to any interest payable by it for an accounting period and elects to have that interest treated as not being a distribution for the purposes of
section 130
(2)(d)(iv), then,
section 130
(2)(d)(iv) shall not apply to that interest.
|
| |
(4) An election under this section in relation to interest payable by a company for an accounting period shall be made in writing to the inspector and furnished together with the company's return of its profits for the period.
|
|
Transactions between associated persons.
[FA80 s44]
|
453.
—(1) In this section, “control” has the same meaning as in
section 11
.
|
| |
(2) Where a company making a claim for relief under this Part (in this subsection referred to as “the buyer”) buys from another person (in this subsection referred to as “the seller”), and—
|
| |
(a) the seller has control over the buyer or, the seller being a body corporate or partnership, the buyer has control over the seller or some other person has control over both the seller and the buyer, and
|
| |
(b) the price in the transaction is less than that which might have been expected to obtain if the parties to the transaction had been independent parties dealing at arm's length,
|
| |
then, the income or losses of the buyer and the seller shall be computed for any purpose of the Tax Acts as if the price in the transaction had been that which would have obtained if the transaction had been a transaction between independent persons dealing at arm's length.
|
| |
(3) Where a company making a claim for relief under this Part (in this subsection referred to as “the seller”) sells goods to another person (in this subsection referred to as “the buyer”) and—
|
| |
(a) the buyer has control over the seller or, the buyer being a body corporate or partnership, the seller has control over the buyer or some other person has control over both the seller and the buyer, and
|
| |
(b) the goods are sold at a price greater than the price which they might have been expected to fetch if the parties to the transaction had been independent parties dealing at arm's length,
|
| |
then, the income or losses of the buyer and the seller shall be computed for any purpose of the Tax Acts as if the goods had been sold by the seller to the buyer for the price which the goods would have fetched if the transaction had been a transaction between independent persons dealing at arm's length.
|
| |
(4) For the purposes of subsection (3), a company shall be deemed to sell goods where and to the extent that for the purposes of this Part any amount receivable by it in payment for any trading activity is regarded as an amount receivable from the sale of goods, and “seller” and “buyer” shall be construed accordingly.
|
| |
(5) The inspector may by notice in writing require a company making a claim for relief under this Part to furnish him or her with such information or particulars as may be necessary for the purposes of this section, and subsection (2) of
section 448
shall apply as if the matters of which proof is required by that subsection included the information or particulars specified in a notice under this section.
|
|
Restriction of certain charges on income.
[CTA76 s10A(1)(a) and (b)(ii), (2) and (3); FA92 s46(1)(a); FA93 s50]
|
454.
—(1) (a) In this section—
|
| |
“trade” means a trade carried on by a company which consists of or includes the manufacture of goods (including activities carried on in an accounting period which, if the company had sufficient profits in that period and made a claim for relief in respect of the trade under this Part for that period, would be regarded for the purposes of this Part as the manufacture of goods);
|
| |
“income from the sale of goods” in an accounting period in the course of a trade carried on by a company
|
| |
shall, subject to
section 422
as applied for the purposes of relief under
section 456
, be such income as would be “the income from the sale of those goods” in that period in the course of the trade for the purposes of a claim under
section 448
(2), if—
|
| |
(i) no group relief under
section 456
or loss relief under
section 455
(3) were allowed against income from the trade in that period,
|
| |
(ii) the company had sufficient profits, and
|
| |
(iii) the company made a claim for relief under this Part;
|
| |
“charges on income paid for the purpose of the sale of goods” in the course of a trade in an accounting period shall be such amount as would be the amount of the income from the sale of goods in that period if, notwithstanding
section 448
(4), “the company's income for the relevant accounting period from the sale in the course of the trade mentioned in that subsection of goods and merchandise” for the purposes of
section 448
(3) were the amount of so much of the charges on income paid wholly and exclusively for the purposes of the trade in that period as appears to the inspector or on appeal to the Appeal Commissioners to be referable to charges on income paid for the purpose of the sale of goods and merchandise;
|
| |
“the sale of goods and merchandise” in the course of a trade carried on by a company means the sale of such goods and merchandise as would respectively be treated as goods and merchandise for the purposes of a claim under this Part, if the company had a sufficiency of profits and had made such a claim.
|
| |
(b) For the purposes of this section, where an accounting period begins before the 1st day of January, 2011, and ends on or after that date, it shall be divided into one part beginning on the day on which the accounting period begins and ending on the 31st day of December, 2010, and another part beginning on the 1st day of January, 2011, and ending on the day the accounting period ends, and both parts shall be treated as if they were separate accounting periods.
|
| |
(2) Notwithstanding
section 243
, so much of the total amount of charges on income paid for the purpose of the sale of goods by a company in an accounting period ending on or before the 31st day of December, 2010, in the course of a trade or trades, as the case may be, shall not be allowed as a deduction against the total profits of the company for the period as exceeds the total amount, reduced by any loss relief under
section 455
(3), of the company's income from the sale of goods in the course of the trade or trades, as the case may be, in the period.
|
| |
(3) (a) Notwithstanding
section 448
(3), the income of a company, referred to in the expression “the income from the sale of those goods”, for any accounting period for the purposes of
section 448
(2) shall be the sum determined by
section 448
(3) for that period reduced by any charges on income paid for the purpose of the sale of goods which are allowed as a deduction against the total profits of the company for that period.
|
| |
(b) Notwithstanding
section 4
(4)(b), the income of a company, referred to in the expression “total income brought into charge to corporation tax”, for any accounting period for the purposes of
section 448
(2) shall be the sum determined by
section 4
(4)(b) for that period reduced by any charges on income paid for the purposes of the sale of goods which are allowed as a deduction against the total profits of the company for that period.
|
| |
(c) Where for any accounting period of a company—
|
| |
(i) the corporation tax referable to the income of the company from the sale of goods is to be reduced under
section 448
, and
|
| |
(ii) charges on income paid for the purpose of the sale of goods have been allowed as a deduction against total profits,
|
| |
then, notwithstanding
section 148
, the charges on income paid for the purpose of the sale of goods shall be deducted from the amount of the relevant deduction in relation to the period for charges on income in
section 148
(1).
|
|
Restriction of certain losses.
[CTA76 s16A; FA92 s46(1)(c)]
|
455.
—(1) (a) In this section—
|
| |
“trade”, “income from the sale of goods” and “the sale of goods and merchandise” have the same meanings respectively as in
section 454
;
|
| |
“a loss from the sale of goods” in the course of a trade in an accounting period shall be such amount as would be the amount of the income from the sale of goods in that period if, notwithstanding
section 448
(4), “the company's income for the relevant accounting period from the sale in the course of the trade mentioned in that subsection of goods and merchandise” for the purposes of
section 448
(3) were the amount of so much of the loss, computed as for the purposes of
section 396
(2), from the trade in the period as appears to the inspector or on appeal to the Appeal Commissioners to be referable to a loss incurred in the sale of goods and merchandise, but a loss such as is mentioned in
section 407
(4)(b) shall not be a loss from the sale of goods.
|
| |
(b)
Section 454
(1)(b) shall apply for the purposes of this section as it applies for the purposes of
section 454
.
|
| |
(2) Notwithstanding
section 396
(2) but subject to subsections (6) and (7), for the purposes of that section the amount of a loss in a trade incurred by a company in an accounting period shall be deemed to be reduced by the amount of a loss from the sale of goods, if any, incurred in the trade by the company in the accounting period.
|
| |
(3) Subject to subsections (6) and (7), where in an accounting period a company carrying on a trade incurs a loss from the sale of goods, the company may make a claim requiring that the loss be set off for the purposes of corporation tax against its income from the sale of goods—
|
| |
(a) of that accounting period, and
|
| |
(b) if it was then carrying on the trade and if the claim so requires, of preceding accounting periods ending within the time specified in subsection (4),
|
| |
and, subject to any relief for an earlier loss, to the extent that the trading income of any of those accounting periods consists of or includes income from the sale of goods, that trading income shall then be reduced by so much of the loss as cannot be relieved against trading income of a later accounting period.
|
| |
(4) For the purposes of subsection (3), the time referred to in paragraph (b) of that subsection shall be the time immediately preceding the accounting period first-mentioned in subsection (3) equal in length to that accounting period; but the amount of the reduction which may be made under subsection (3) in the trading income of an accounting period falling partly before that time shall not exceed such part of the income from the sale of goods included in that trading income as bears to the income from the sale of goods the same proportion as the part of the accounting period falling within that time bears to the whole of that accounting period.
|
| |
(5) (a) In
section 448
(3) and for the purposes of determining “the amount” in the expression “the amount of the company's income for the relevant accounting period from the sale in the course of the trade mentioned in that subsection of goods and merchandise”, it shall be determined in accordance with
section 448
(4) as if no relief for a loss in a trade had been claimed under this section.
|
| |
(b) Notwithstanding
section 448
(3), for the purposes of determining “the income” in the expression “the income from the sale of those goods” in an accounting period for the purposes of
section 448
(2), it shall be the sum determined by
section 448
(3) for that period reduced by any relief for a loss in a trade allowed under this section against income of the trade mentioned in
section 448
(2) in that period.
|
| |
(6) This section shall not apply to so much of a company's loss from the sale of goods in the course of a trade in an accounting period as does not exceed the amount of the capital allowances under
Part 9
or
Chapter 1
of
Part 29
which are to be made for the accounting period in taxing the trade, and for the purposes of this subsection no account shall be taken of capital allowances other than capital allowances in respect of machinery or plant or an industrial building or structure—
|
| |
(a) provided for the purposes of a project approved within the period of 2 years ending on the 31st day of December, 1988, by the Industrial Development Authority,
|
| |
(b) the expenditure on the provision of which was incurred on or before the 31st day of March, 1995, and
|
| |
(c) more than 50 per cent of the expenditure on the provision of which was incurred, or was the subject of a binding contract entered into, before the 1st day of April, 1992.
|
| |
(7) This section shall not apply to so much of a company's loss from the sale of goods in the course of a trade in an accounting period as does not exceed the amount of the capital allowances under
section 323
(2) deducted by the company in computing the loss which the company has incurred in that period in carrying on trading operations specified in a certificate given to it, and not subsequently revoked, by the Minister for Finance under
section 446
.
|
|
Restriction of group relief.
[CTA76 s116A(1)(a) and (b)(ii), (2) and (3), (4)(b) and (5); FA88 s34; FA92 s46(2)]
|
456.
—(1) (a) In this section—
|
| |
“trade”, “income from the sale of goods”, “charges on income paid for the purposes of the sale of goods” and “the sale of goods and merchandise” have the same meanings respectively as in
section 454
;
|
| |
“a loss from the sale of goods” has the same meaning as in
section 455
;
|
| |
“an excess of charges on income paid for the purpose of the sale of goods” in the course of the trade in an accounting period shall be so much of an amount, being the amount by which the charges on income paid by a company for the purpose of the sale of goods in the course of the trade in that period exceed the income from the sale of goods in the course of the trade in that period, as does not exceed the excess referred to in
section 420
(6) as computed for the company for that period.
|
| |
(b)
Section 454
(1)(b) shall apply for the purposes of this section as it applies for the purposes of
section 454
.
|
| |
(2) (a) Notwithstanding subsections (1) and (6) of
section 420
and
section 421
but subject to subsection (4), where in any accounting period ending on or before the 31st day of December, 2010, the surrendering company incurs a loss from the sale of goods or an excess of charges on income paid for the purpose of the sale of goods, that loss or excess may be set off for the purposes of corporation tax against income from a trade of the claimant company for its corresponding accounting period to the extent of that income or, if it is less, to the extent of the income from the sale of goods in the course of the trade reduced by—
|
| |
(i) charges on income paid for the purposes of the sale of goods (within the meaning of
section 454
), and
|
| |
(ii) any loss relief under
section 455
(3);
|
| |
but no other relief shall be given in respect of that loss or excess to a company other than the surrendering company.
|
| |
(b) Group relief allowed under paragraph (a) shall reduce the income from a trade of the claimant company for an accounting period—
|
| |
(i) before relief granted under
section 397
in respect of a loss incurred in a succeeding accounting period or periods, and
|
| |
(ii) after the relief granted under
section 396
in respect of a loss incurred in a preceding accounting period or periods.
|
| |
(3) (a) For the purposes of
section 448
(3), “the amount of the company's income for the relevant accounting period from the sale in the course of the trade mentioned in that subsection of goods and merchandise” shall be determined in accordance with
section 448
(4) as if no group relief had been allowed under this section.
|
| |
(b) Notwithstanding
section 448
(3), “the income from the sale of those goods” in an accounting period for the purposes of
section 448
(2) shall be the sum determined by
section 448
(3) for that period reduced by any group relief allowed under this section against income of the trade mentioned in
section 448
(2) in that period.
|
| |
(4) This section shall not apply to so much of a loss from the sale of goods in the course of a trade in an accounting period as does not exceed the amount of the capital allowances under
section 323
(2) deducted by the surrendering company in computing the loss which the company has incurred in that period in carrying on trading operations specified in a certificate given to it, and not subsequently revoked, by the Minister for Finance under
section 446
.
|
| |
(5) For the purposes of this section—
|
| |
(a) in the case of a claim made by a company as a member of a consortium, only a fraction of a loss from the sale of goods or an excess of charges on income paid for the purpose of the sale of goods may be set off, and that fraction shall be equal to that member's share in the consortium, subject to any further reduction under
section 422
(2), and
|
| |
(b)
section 422
shall apply as if—
|
| |
(i) for “total profits” in subsection (2)(a) of that section there were substituted “income from a trade”, and
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(ii) for “those profits” in subsection (2)(b) of that section there were substituted “the income from the sale of goods in the course of a trade of the claimant company”.
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Application of
section 448
where profits are charged to corporation tax at the reduced rate.
[CTA76 s28A(10); FA96 s44; FA97 s60(1)(b)]
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457.
—Where any part of the profits of an accounting period of a company is charged to corporation tax in accordance with
section 22
, then—
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(a) for the purposes of
section 448
, the relevant corporation tax in relation to the accounting period shall be reduced by an amount determined by the formula—
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| |
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where—
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R is the rate per cent specified in
section 22
(1) in relation to the accounting period, and
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| |
S is an amount equal to so much of the profits of the company for the accounting period as are charged to tax in accordance with
section 22
(1),
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and
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(b) notwithstanding
section 4
(4)(b), the income of a company, referred to in the expression “total income brought into charge to corporation tax”, for the accounting period for the purposes of
section 448
(2) shall be the sum determined by
section 4
(4)(b) for that period reduced—
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(i) in accordance with
sections 454
and
455
, and
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| |
(ii) by an amount equal to so much of the profits of the company for the accounting period as are charged to tax in accordance with
section 22
(1).
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