Textual Amendments
F1Sch. A1 inserted (with effect in accordance with Sch. 25 para. 9 of the amending Act) by Finance Act 2008 (c. 9), Sch. 25 para. 5
18(1)Where a company is entitled to a first-year tax credit for a chargeable period and makes a claim for payment of the credit, HMRC must pay to the company the amount of the credit.U.K.
(2)An amount payable in respect of—
(a)a first-year tax credit, or
(b)interest on a first-year tax credit under section 826 of ICTA,
may be applied in discharging any liability of the company's to pay corporation tax.
(3)To the extent that it is so applied, HMRC's obligation under sub-paragraph (1) is discharged.
(4)Where HMRC enquires into the company's company tax return for the chargeable period, no payment in respect of a first-year tax credit for that chargeable period need be made before HMRC's enquiries are completed (see paragraph 32 of Schedule 18 to FA 1998).
(5)In those circumstances HMRC may make a payment on a provisional basis of such amount as it thinks fit.
(6)No payment need be made in respect of a first-year tax credit for a chargeable period before the company has paid to HMRC any amount that it is required to pay for payment periods (within the meaning of paragraph 17(2)) ending in that chargeable period—
(a)under the PAYE regulations, or
(b)in respect of Class 1 national insurance contributions.
19(1)For the purposes of the relieving provisions (see paragraph 20), the company's loss from the qualifying activity for a chargeable period in which it claims a first-year tax credit is treated as reduced by the amount of the loss surrendered.U.K.
(2)For the purposes of this Schedule, the amount of the loss surrendered is—
(a)where the amount of first-year tax credit mentioned in paragraph 2(1)(a) is claimed, the whole of the surrenderable loss for that period, and
(b)where less than that amount is claimed, a corresponding proportion of the surrenderable loss for that period.
20U.K.The relieving provisions are—
(a)where the qualifying activity is a trade or a furnished holiday lettings business and paragraph 21 or 22 does not apply, [F2section 45 of CTA 2010] (relief of trading losses against future profits),
(b)where the qualifying activity is managing the investments of a company with investment business, [F3section 1223 of CTA 2009 (carrying expenses forward)],
(c)where the qualifying activity is a [F4UK property business] (other than a furnished holiday lettings business) and paragraph 21 does not apply, [F5section 62(5) of CTA 2010] (relief of [F6UK property business losses] against future profits), and
(d)where the qualifying activity is an overseas property business and paragraph 21 does not apply, [F7section 66 of CTA 2010] (relief of overseas property losses against future profits).
Textual Amendments
F2Words in Sch. A1 para. 20(a) substituted (1.4.2010) (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 364(11)(a) (with Sch. 2)
F3Words in Sch. A1 para. 20(b) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 521(10)(a) (with Sch. 2 Pts. 1, 2)
F4Words in Sch. A1 para. 20(c) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 521(10)(b)(i) (with Sch. 2 Pts. 1, 2)
F5Words in Sch. A1 para. 20(c) substituted (1.4.2010) (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 364(11)(b) (with Sch. 2)
F6Words in Sch. A1 para. 20(c) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 521(10)(b)(ii) (with Sch. 2 Pts. 1, 2)
F7Words in Sch. A1 para. 20(d) substituted (1.4.2010) (with effect in accordance with s. 1184(1) of the amending Act) by Corporation Tax Act 2010 (c. 4), s. 1184(1), Sch. 1 para. 364(11)(c) (with Sch. 2)
21(1)This paragraph applies if the qualifying activity is a [F8UK property business] or an overseas property business, and in a chargeable period—U.K.
(a)the company's loss in carrying on that activity is a loss treated under section 432AB(3) of ICTA, for the purposes of section 76 of that Act, as expenses payable which fall to be brought into account at Step 3 in subsection (7) of that section,
(b)an amount falls to be carried forward to a succeeding chargeable period under section 76(12) of that Act (carrying forward unrelieved expenses on income), and
(c)the company claims a first-year tax credit for the chargeable period.
(2)The total amount which falls to be carried forward to a succeeding chargeable period under section 76(12) of ICTA is treated as reduced by the amount of the loss surrendered.
Textual Amendments
F8Words in Sch. A1 para. 21(1) substituted (with effect in accordance with s. 1329(1) of the amending Act) by Corporation Tax Act 2009 (c. 4), s. 1329(1), Sch. 1 para. 521(11) (with Sch. 2 Pts. 1, 2)
22(1)This paragraph applies where the qualifying activity is life assurance business and the profits of that business are charged to tax under the I minus E basis.U.K.
(2)For the purposes of section 76 of ICTA, the total amount which may—
(a)be carried forward under subsection (12) of that section from a chargeable period in which the company claims a first-year tax credit, and
(b)be brought into account for the next chargeable period in accordance with Step 7 in subsection (7) of that section,
is treated as reduced by the amount of the loss surrendered.
23U.K.A payment in respect of a first-year tax credit is not income of the company for any tax purposes.]