Section 357PC — Corporation Tax Act 2010: Tax credit under section 1054 of CTA 2009: entitlement

Tax credit under section 1054 of CTA 2009: entitlement 357PC 1 Section 1055 of CTA 2009 (meaning of “Chapter 2 surrenderable loss”) does not apply to a company in relation to a qualifying trade it carries on in an accounting period in which it is a Northern Ireland company (and the following provisions of this section apply instead).

2 The company has a Chapter 2 surrenderable loss in the period for the purposes of Chapter 2 of Part 13 of CTA 2009 if—

a it obtains an additional deduction under section 1044 of CTA 2009 in the accounting period in calculating the profits of the trade, and b it has—

i a Northern Ireland loss of the trade in the period, or ii a mainstream loss of the trade in the period.

3 In this Chapter—

a “ Northern Ireland Chapter 2 surrenderable loss ” means a Chapter 2 surrenderable loss that a company has by virtue of subsection (2)(b)(i);

b “ mainstream Chapter 2 surrenderable loss ” means a Chapter 2 surrenderable loss that a company has by virtue of subsection (2)(b)(ii).

4 The amount of a Northern Ireland Chapter 2 surrenderable loss is—

a so much of the Northern Ireland loss in question as is unrelieved, or b if less, the Northern Ireland qualifying Chapter 2 expenditure in respect of which the relief was obtained, multiplied by the adjusted section 1044 percentage.

5 The amount of a mainstream Chapter 2 surrenderable loss is—

a so much of the mainstream loss in question as is unrelieved, or b if less, the qualifying Chapter 2 expenditure in respect of which the relief was obtained that is not Northern Ireland qualifying Chapter 2 expenditure, multiplied by the percentage specified in section 1055(2)(b) of CTA 2009.

6 For the purposes of this section “ the adjusted section 1044 percentage ” means— 100 + ( A × MR NIR ) where— A is percentage specified in section 1044(8) of CTA 2009; MR is the main rate for the financial year in which the expenditure is incurred; NIR is the Northern Ireland rate for the financial year in which the expenditure is incurred.

7 Section 1056 of CTA 2009 (amount of trading loss which is unrelieved) applies for the purposes of this section.

8 In the application of section 1056 of CTA 2009 by virtue of subsection (7), subsection (2)(c) of that section has effect as if the reference to any loss surrendered under Part 5 of CTA 2010 were—

a where the trading loss in question is a Northern Ireland loss, to any of that Northern Ireland loss surrendered under that Part;

b where the trading loss in question is a mainstream loss, to any of that mainstream loss surrendered under that Part.