Corporation Tax Act 2009

[F1 CHAPTER 4 U.K. Programme losses

Textual Amendments

F1 Pt. 15A inserted (17.7.2013 for specified purposes, 19.7.2013 in so far as not already in force, and with effect in accordance with Sch. 16 para. 3 of the amending Act) by Finance Act 2013 (c. 29), Sch. 16 paras. 1, 2; S.I. 2013/1817, art. 2(1)

1216D Application of sections 1216DA and 1216DB U.K.

(1) Sections 1216DA and 1216DB apply to a company that is the television production company in relation to a relevant programme.

(2) In those sections—

• “the completion period” means the accounting period of the company—

  (a)

  in which the relevant programme is completed, or

  (b)

  if the company does not complete the relevant programme, in which it abandons television production activities in relation to the programme,

• “loss relief” includes any means by which a loss might be used to reduce the amount in respect of which the company, or any other person, is chargeable to tax,

• “pre-completion period” means an accounting period of the company before the completion period, and

• “the separate programme trade” means the company's separate trade in relation to the relevant programme (see section 1216B).

1216DA Restriction on use of losses while programme in production U.K.

(1) This section applies if in a pre-completion period a loss is made in the separate programme trade.

(2) The loss is not available for loss relief except to the extent that it may be carried forward under section 45 [F2 or 45B] of CTA 2010 to be [F3 deducted from] profits of the separate programme trade in a subsequent period.

[F4 (3) If the loss is carried forward under section 45 or 45B of CTA 2010 and deducted from profits of the separate programme trade in a subsequent period, the deduction is to be ignored for the purposes of section 269ZB of CTA 2010 (restriction on deductions from trading profits).]

Textual Amendments

F2 Words in s. 1216DA(2) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 32(2)(a)

F3 Words in s. 1216DA(2) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 32(2)(b)

F4 S. 1216DA(3) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 32(3)

Modifications etc. (not altering text)

C1 S. 1216DA modified by 2010 c. 4, s. 357SF (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

1216DB Use of losses in later periods U.K.

(1) This section applies to the following accounting periods of the company (“relevant later periods”)—

(a) the completion period, and

(b) any subsequent accounting period during which the separate programme trade continues.

(2) Subsection (3) applies if a loss made in the separate programme trade is carried forward under section 45 [F5 or 45B] of CTA 2010 from a pre-completion period to a relevant later period.

(3) So much (if any) of the loss as is not attributable to television tax relief (see subsection (6)) may be treated for the purposes of [F6 section 37 and Part 5 of CTA 2010] as if it were a loss made in the period to which it is carried forward.

(4) [F7 Subsections (5) and (5A) apply] if in a relevant later period a loss is made in the separate programme trade.

(5) The amount of the loss that may be—

(a) deducted from total profits of the same or an earlier period under section 37 of CTA 2010, or

[F8 (ab) carried forward under section 45A of that Act to be deducted from the total profits of a later period,]

(b) surrendered as group relief under Part 5 of that Act,

is restricted to the amount (if any) that is not attributable to television tax relief (see subsection (6)).

[F9 (5A) A deduction under section 45 or 45B of CTA 2010 which is made in respect of so much of the loss as is attributable to television tax relief is to be ignored for the purposes of section 269ZB of that Act (restriction on deductions from trading profits).]

(6) The amount of a loss in any period that is attributable to television tax relief is calculated by deducting from the total amount of the loss the amount there would have been if there had been no additional deduction under Chapter 3 in that or any earlier period.

(7) This section does not apply to a loss to the extent that it is carried forward or surrendered under section 1216DC.

Textual Amendments

F5 Words in s. 1216DB(2) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 33(2)

F6 Words in s. 1216DB(3) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 33(3)

F7 Words in s. 1216DB(4) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 33(4)

F8 S. 1216DB(5)(ab) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 33(5)

F9 S. 1216DB(5A) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 33(6)

Modifications etc. (not altering text)

C2 S. 1216DB modified by 2010 c. 4, s. 357SG (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)

1216DC Terminal losses U.K.

(1) This section applies if—

(a) a company (“company A”) is the television production company in relation to a qualifying programme,

(b) company A ceases to carry on its separate trade in relation to that programme (“trade X”) (see section 1216B), and

(c) if company A had not ceased to carry on trade X, it could have carried forward an amount under section 45[F10 , 45A or 45B] of CTA 2010 to be set against profits of F11 ... a later period (“the terminal loss”).

(2) If on cessation of trade X company A—

(a) is the television production company in relation to another qualifying programme, and

(b) is carrying on its separate trade in relation to that programme (“trade Y”),

it may (on making a claim) make an election under subsection (3).

(3) The election is to have the terminal loss (or a part of it) treated[F12 —

(a) in a case where the loss could have been carried forward under section 45 of CTA 2010 had trade X not ceased, as if it were a loss carried forward under that section to be set against the profits of trade Y of the first accounting period beginning after the cessation and so on, and

(b) in a case where the loss could have been carried forward under section 45A or 45B of CTA 2010 had trade X not ceased, as if it were a loss made in trade Y which has been carried forward under section 45B of that Act to the first accounting period beginning after the cessation.]

(4) Subsection (5) applies if on cessation of trade X—

(a) there is another company (“company B”) that is the television production company in relation to a qualifying programme,

(b) company B is carrying on its separate trade in relation to that programme (“trade Z”), and

(c) company B is in the same group as company A for the purposes of Part 5 of CTA 2010 (group relief).

(5) Company A may surrender the terminal loss (or a part of it) to company B.

(6) On the making of a claim by company B the amount surrendered is treated[F13 —

(a) in a case where the amount could have been carried forward under section 45 of CTA 2010 had trade X not ceased, as if it were a loss carried forward under that section to be set against the profits of trade Z of the first accounting period beginning after the cessation and so on, and

(b) in a case where the amount could have been carried forward under section 45A or 45B of CTA 2010 had trade X not ceased, as if it were a loss made in trade Z which has been carried forward under section 45B of that Act to the first accounting period beginning after the cessation.]

(7) The Treasury may, in relation to the surrender of a loss under subsection (5) and the resulting claim under subsection (6), make provision by regulations corresponding, subject to such adaptations or other modifications as appear to them to be appropriate, to that made by Part 8 of Schedule 18 to FA 1998 (company tax returns: claims for group relief).

[F14 (7A) A deduction under section 45 or 45B of CTA 2010 which is made in reliance on this section is to be ignored for the purposes of section 269ZB of that Act (restriction on deductions from trading profits).]

(8) “Qualifying programme” means a relevant programme in relation to which the conditions for television tax relief are met (see 1216C(2)).]

Textual Amendments

F10 Words in s. 1216DC(1)(c) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 34(2)(a)

F11 Words in s. 1216DC(1)(c) omitted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by virtue of Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 34(2)(b)

F12 Words in s. 1216DC(3) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 34(3)

F13 Words in s. 1216DC(6) substituted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 34(4)

F14 S. 1216DC(7A) inserted (with effect in accordance with Sch. 4 para. 190 of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 4 para. 34(5)

Modifications etc. (not altering text)

C3 S. 1216DC modified by 2010 c. 4, s. 357SH (as inserted (with effect in accordance with s. 5 of the amending Act) by Corporation Tax (Northern Ireland) Act 2015 (c. 21), s. 1)