CTA meaning

This Flowchart has been archived and is not maintained. Please be aware the patent box computation was revised for fresh claims from July 2016 to align with the framework for preferential intellectual property regimes established under the OECD BEPS project...

UK Care No 1 Ltd v HMRC [2026] UKUT 90 (TCC) The appellant, UKC1, was a Guernsey-incorporated company. It served as the issuer of loan notes within a securitisation structure for the BUPA group. Those notes were placed at a discount and incurred transaction expenses. UKC1 recognised the obligation on an amortised cost basis. That accounting treatment reflected the discounted issue price and the associated fees borne at issue time. (CTA 2009, s 327 is inapplicable where fair value accounting is adopted.) In 2016—when BUPA intended to dispose of certain care homes included in the collateral package—BUPA acquired UKC1 and it became resident for UK tax. UKC1 subsequently bought back the loan notes. The terms for early repayment were set by a ‘Spens’ (or ‘make whole’) provision, which required payment of whichever was greater: the principal sum, or the present value of future cash flows, discounted by reference to a named gilt...

Muller UK and Ireland Group LLP and others v HMRC [2026] EWCA Civ 248 The second, third and fourth appellants (the Corporate Members) were part of the Muller multinational corporate group trading in dairy products. In 2013, those appellants moved their respective trades and assets, including intellectual property and goodwill, to the fourth appellant, Muller UK and Ireland Group LLP (LLP), receiving membership units in the LLP in exchange. The LLP recorded amortisation of the assets and goodwill (the Material Assets) in its accounts on a straight-line basis over five years. When calculating their taxable profits from the LLP for the 2013–18 accounting periods, the Corporate Members claimed deductions for that amortisation under Part 8 of the Corporation Tax Act 2009 (CTA 2009). HMRC rejected the claims on the footing that the Material Assets did not satisfy the Part 8 ‘gateway’ in CTA 2009, s 882(1)(b) (as then in force). That provision removed from Part 8’s scope assets obtained from a related party. While Part 8 does not expressly...

HMRC v Dolphin Drilling Ltd [2025] UKSC 24 Dolphin hired the Borgsten on charter from a related entity to act as a tender support vessel (TSV), delivering tender assisted drilling (TAD) operations to the Dunbar oil installation under a contract with the platform’s operator, Total. Beyond the TAD scope, and in addition to delivering those services, the Borgsten also served as living quarters for approximately sixty members of Total’s workforce engaged on Dunbar, alongside the company’s own crew based on the Borgsten. HMRC took the view that the hire restriction in section 356N of the Corporation Tax Act 2010 (CTA 2010) was in point; however, the company contended that the carve‑out in CTA 2010, s 356LA(3) applied, on the basis that it was reasonable to assume the Borgsten’s use for housing Total personnel was ‘unlikely to be more than incidental to...

UK real estate investment trusts (UK REITs) The UK regime for real estate investment trusts (REITs, termed UK REITs in statute) took effect on 1 January 2007. There are now in excess of 150 REITs, several of which moved into the structure when the framework first commenced. Those early adopters have since been joined by many more participants owing to revisions to the entry criteria, in particular the following: the removal of the entry charge; permission for REITs to invest in other REITs; and a relaxation of the listing condition so that companies without a formal listing, but admitted to trading and actually traded on a recognised stock exchange (for example on markets such as AIM), can also qualify. Further amendments have been introduced to the REIT rules in recent years with the stated intention of making the regime more appealing to prospective entrants. The principal legislative provisions for the REIT tax regime sit in Part 12 of the Corporation Tax...

Ordinarily, distributions take the form of cash dividends paid by a company to its shareholders—essentially a straightforward payment of profits to the company’s owners. However, the corporation tax meaning of distribution differs from the company law concept (see Practice Note: Dividends, distributions and scrip dividends). Why does it matter whether a payment is a distribution? It is vital to establish whether a particular payment by a UK company is a distribution because, if it is: the paying company is not permitted a deduction for the amount in its UK corporation tax computation; and a UK corporate recipient will be chargeable to corporation tax on the amount under CTA 2009, Part 9A, unless the payment falls within one of the specific exemptions—for further detail, see Practice Notes: How are small companies taxed on distributions received? and How are non-small companies taxed on distributions received? Since most routine distributions are covered by an exemption from tax, it will usually be in the recipient’s...

It should not be presumed that the fiscal treatment of charities is uniform across every tax regime. Broadly speaking, charities benefit from significant tax reliefs. Nevertheless, income tax and corporation tax do not generally mirror the rules for, say, VAT, so the fact that a charity is relieved from VAT does not guarantee it avoids income tax, and the converse can also apply. Essentially, the initial obstacle is to demonstrate to HMRC that the body is a charity; that is, it exists solely for charitable purposes. Subsequently, the income tax reliefs for charitable trusts are contained in Part 10 of the Income Tax Act 2007 (ITA 2007), while corporation tax provisions for charitable companies are found in Part 11 of the Corporation Tax Act 2010 (CTA 2010)...

1 Definitions and interpretation 1.1 In this Agreement, and except where the context dictates otherwise, the expressions below shall bear the meanings set out here: Relevant Proportion means, for the purpose of clause, the greatest share of the Company’s [ trading ] losses [ and other amounts eligible for relief from taxation ] that the law permits to be surrendered to the relevant Shareholder (or a member of its Shareholder Group), or, as applicable, the greatest share of the Company’s trading profits against which the Shareholder (or a member of its Shareholder Group) is permitted by law to surrender its [ trading ] losses [ and other amounts eligible for relief from taxation ] ; VAT means United Kingdom value added tax [ and any other tax imposed in substitution for it OR , any other tax imposed in substitution for it and any equivalent or similar tax imposed outside the United Kingdom ] ; 2 Tax matters 2.1 [ The...

[ Team Leader ] [ insert HMRC address ] [ insert date ] Application seeking advance clearance under section 1091 of the Corporation Tax Act 2010 [and sections 138 and 139(5) of the Taxation of Chargeable Gains Act 1992] 1 Introduction We act on behalf of [ insert name of the target company ] (Company A) [ and for the shareholders of Company A ]. Company A qualifies as the ‘distributing company’ for the purposes of section 1079 of the Corporation Tax Act 2010 (CTA 2010). [ In connection with the proposed arrangements outlined in this letter, we request confirmation under CTA 2010, s 1091 that the distribution described herein will be treated as an exempt distribution within the meaning of CTA 2010, s 1075 ]...

[ Letterhead ] [ Addressed to HMRC Officer ] [ Date ] We jointly make an election under section 792 of the Corporation Tax Act 2009 (CTA 2009) that [ the whole OR [ insert a specific amount, a percentage or a fraction ] ] of the chargeable realisation gain arising on the deemed realisation and reacquisition of the intangible assets is to be regarded as attributable to [ full company name ] (Company B) rather than [ full company name ] (Company A)...