SCHEDULES

SCHEDULE 17 Controlled foreign companies

Paragraph 3 of Schedule 26

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1

Paragraph 3 of Schedule 26 to the Taxes Act 1988 (gains on disposal of shares in controlled foreign companies) shall be amended as follows.

2

In sub-paragraph (1), for paragraph (a) (which refers to a direction having been given in respect of an accounting period of a controlled foreign company) there shall be substituted—

a

an accounting period of a controlled foreign company (“the apportionment period”) is one in respect of which an apportionment under section 747(3) falls to be made; and

3

Accordingly, in paragraphs (b) and (c) of sub-paragraph (1), for the words “the direction period", in each place where they occur, there shall be substituted “ the apportionment period ”.

4

In paragraph (d) of sub-paragraph (1) (which refers to a sum being, under section 747(1)(a), assessed and recoverable from a company) for “assessed on and recoverable from" there shall be substituted “ chargeable on ”.

5

In sub-paragraph (3), for “the direction period" there shall be substituted “ the apportionment period ”.

6

In sub-paragraph (4), in the words following paragraph (c), for “assessed and recoverable" there shall be substituted “ chargeable under section 747(4)(a) ”.

7

After subsection (6) there shall be inserted—

6A

Nothing in—

a

paragraph 10 of Schedule 18 to the Finance Act 1998 (claims or elections in company tax returns), or

b

Schedule 1A to the Management Act (claims or elections not included in returns),

shall apply, whether by virtue of section 754 or otherwise, to a claim under sub-paragraph (6) above.