Corporation Tax Act 2009

1266 Resident partners and double taxation agreements

(1) This section applies if—

(a) a UK resident company (“the partner”) is a member of a firm which—

(i) resides outside the United Kingdom, or

(ii) carries on a trade the control and management of which is outside the United Kingdom, and

(b) by virtue of any arrangements having effect under section 788 of ICTA (“the arrangements”) any of the income of the firm is relieved from corporation tax in the United Kingdom.

(2) The partner is liable to corporation tax on the partner’s share of the income of the firm despite the arrangements.

(3) If the partner’s share of the income of the firm consists of or includes a share in a qualifying distribution made by a UK resident company, the partner (and not the firm) is, despite the arrangements, entitled to the share of the tax credit which corresponds to the partner’s share of the distribution.

(4) For the purposes of this section the members of a firm include any company which is entitled to a share of the income of the firm.