Section 1259 — Corporation Tax Act 2009: Calculation of firm's profits and losses

Calculation of firm's profits and losses 1259 1 This section applies if a firm carries on a trade and any partner in the firm (“the partner”) is a company within the charge to corporation tax.

2 For any accounting period of the firm, the amount of the profits of the trade (“the amount of the firm's profits”) is taken to be the amount determined, in relation to the partner, in accordance with subsection (3) or (4).

3 If the partner is UK resident—

a determine what would be the amount of the profits of the trade chargeable to corporation tax for that period if a UK resident company carried on the trade, and b take that to be the amount of the firm's profits.

4 If the partner is non-UK resident—

a determine what would be the amount of the profits of the trade chargeable to corporation tax for that period if a non-UK resident company carried on the trade, and b take that to be the amount of the firm's profits.

5 The amount of any losses of the trade for an accounting period of the firm is calculated, in relation to the partner, in the same way as the amount of any profits.

6 This section is subject to section 1260.