Section 480 — Corporation Tax Act 2010: Exemption for profits of small-scale trades

Exemption for profits of small-scale trades 480 1 The income mentioned in subsection (2) is not taken into account in calculating total profits if conditions A and B are met.

2 The income referred to in subsection (1) is—

a the profits of a trade carried on by a charitable company, and b post-cessation receipts arising from a trade carried on by a charitable company which are received by the company or to which it is entitled.

3 Subsection (1) does not apply in respect of—

a profits of a trade that are, apart from this section, exempt from corporation tax chargeable under Part 3 of CTA 2009, or b post-cessation receipts that are, apart from this section, exempt from corporation tax chargeable under Chapter 15 of Part 3 of CTA 2009.

4 Condition A is—

a in the case of the profits of a trade, that the profits are profits of an accounting period in relation to which the condition specified in section 482 (condition as to trading and miscellaneous incoming resources) is met, and b in the case of a post-cessation receipt, that it is received in such an accounting period.

5 Condition B is that the profits are, or (as the case may be) the receipt is, applied to the purposes of the charitable company only.

6 The exemption under subsection (1) requires a claim.

7 In this section “ post-cessation receipt ” means an amount that is a post-cessation receipt for the purposes of Part 3 of CTA 2009 (see sections 190 to 195 of that Act).