Corporation Tax Act 2009

Income Tax Act 2007 (c. 3)U.K.

699U.K.The Income Tax Act 2007 is amended as follows.

700U.K.For section 5 substitute—

“5Income tax and companies

Section 3 of CTA 2009 disapplies the provisions of the Income Tax Acts relating to the charge to income tax in relation to income of a company (not accruing to it in a fiduciary or representative capacity) if—

(a)the company is UK resident, or

(b)the company is non-UK resident and the income is within its chargeable profits as defined by section 19 of that Act (profits attributable to its permanent establishment in the United Kingdom).”

701U.K.In section 276(3) (conditions relating to income) for “paragraph 14(3) of Schedule 26 to FA 2002 as if they were non-trading credits or non-trading debits” substitute “ section 574 of CTA 2009 (non-trading credits and debits to be brought into account under Part 5 of that Act) ”.

702U.K.In section 489(6) (the “applicable period” in relation to shares) for “paragraph 9 of Schedule 4AA to ICTA” substitute “ section 989 of CTA 2009 ”.

F1703U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F2704U.K.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

705(1)Amend section 835 (residence rules for trustees and companies) as follows.U.K.

(2)Omit subsection (2).

(3)In the title omit “and companies”.

706U.K.After section 835 insert—

“835AResidence of companies

Chapter 3 of Part 2 of CTA 2009 (rules for determining residence of companies) applies for the purposes of the Income Tax Acts as it applies for the purposes of the Corporation Tax Acts.”

707U.K.In section 899(4)(b) (meaning of “qualifying annual payment”) for “charged to corporation tax under Case III of Schedule D” substitute “which is—

(i)required to be brought into account under Part 5 of CTA 2009 (loan relationships) as a non-trading credit, or

(ii)from a source in the United Kingdom and chargeable to corporation tax under Chapter 5 of Part 10 of that Act (distribution from unauthorised unit trusts) or Chapter 7 of that Part (annual payments not otherwise charged).”

708U.K.In section 904 (annual payments for dividends or non-taxable consideration) for subsection (2) substitute—

“(2)The payment must be—

(a)a payment charged to income tax under Part 5 of ITTOIA 2005 (miscellaneous income), or

(b)a payment which is—

(i)required to be brought into account under Part 5 of CTA 2009 (loan relationships) as a non-trading credit, or

(ii)from a source in the United Kingdom and chargeable to corporation tax under Chapter 5 of Part 10 of that Act (distributions from unauthorised unit trusts) or Chapter 7 of that Part (annual payments not otherwise charged).”

709(1)Amend section 910 (proceeds of a sale of patent rights: payments to non-UK residents) as follows.U.K.

(2)In subsection (1)(b) for “section 524(3) of ICTA” substitute “ section 912 of CTA 2009 ”.

(3)In subsection (6)(b) for “section 524(9) of ICTA” substitute “ section 919 of CTA 2009 ”.

710U.K.In section 934(4) (non-UK resident companies) for “section 11(2) of ICTA” substitute “ section 19 of CTA 2009 ”.

711U.K.In section 937(5)(c) (partnerships)—

(a)for “section 11(2) of ICTA” substitute “ section 19 of CTA 2009 ”, and

(b)for “sections 114 and 115 of ICTA” substitute “ Part 17 of that Act ”.

712U.K.In section 939(1)(b) (duty to retain bonds where issue treated as payment of interest) for “section 582(1)(a) of ICTA” substitute “ section 413 of CTA 2009 ”.

713(1)Amend section 941 (deemed payments to unit holders and deemed deductions of income tax) as follows.U.K.

(2)In subsection (1), after “ITTOIA 2005” insert “ or Chapter 5 of Part 10 of CTA 2009 ”.

(3)In subsection (2), after “ITTOIA 2005” insert “ and section 973(2) of CTA 2009 ”.

(4)Omit subsections (4) and (5).

(5)In subsection (6)—

(a)in the definition of “deemed deduction”, omit “or (5)”, and

(b)in the definition of “deemed payment”, omit “or (4)”.

714U.K.In section 948(2) (meaning of “accounting period”) for the words from “section” to “assessment)” substitute “ Chapter 2 of Part 2 of CTA 2009 (accounting periods) ”.

715U.K.In section 965(2) (overview of sections 966 to 970) for “section 556 of ICTA” substitute “ section 1309 of CTA 2009 ”.

716(1)Amend section 971 (income tax in respect of non-resident landlords) as follows.U.K.

(2)In subsection (2) for the words from “chargeable” to the end substitute “ chargeable as the profits of a UK property business under Chapter 3 of Part 3 of ITTOIA 2005 or Chapter 3 of Part 4 of CTA 2009. ”

(3)In subsection (3)(a) for “Schedule A business, or a UK property business,” substitute “ UK property business (within the meaning of Chapter 2 of Part 3 of ITTOIA 2005 or Chapter 2 of Part 4 of CTA 2009) ”.

717U.K.In section 976(6) (arrangements for payments of interest less tax or at a specified net rate) for paragraph (b) substitute—

“(b)interest which is required to be brought into account under Part 5 of CTA 2009 (loan relationships) as a non-trading credit of the recipient.”

718U.K.In section 980(2) (derivative contracts: exception from duties to deduct) for “Schedule 26 to FA 2002” substitute “ Part 7 of CTA 2009 ”.

719U.K.In section 989 (definitions) omit the definition of “Schedule A business”.

720U.K.In section 1017 (abbreviated references to Acts) after the definition of “CAA 2001” insert—

““CTA 2009” means the Corporation Tax Act 2009,”.

721U.K.In Schedule 4 (index of defined expressions) omit the entry for “Schedule A business”.