Section 197 — Corporation Tax Act 2010: Restrictions on associated benefits

Restrictions on associated benefits 197 1 For the purposes of this Chapter the restrictions on benefits associated with a payment are breached if condition A or B is met.

2 Condition A is that the total value of the benefits associated with the payment exceeds the variable limit, which is—

a in a case where the amount of the payment is £100 or less, 25% of that amount, and b in a case where the amount of the payment exceeds £100, the sum of £25 and 5% of the amount of the excess.

3 Condition B is that the sum of the following total values is more than £2,500 —

a the total value of the benefits associated with the payment, and b the total value of the benefits (if any) associated with each relevant prior payment.

4 A relevant prior payment is a payment—

a which has already been made by the company to the charity in the accounting period, and b which is a qualifying payment.

5 This section needs to be read with section 198.