Finance (No. 3) Act 2010

3 (1) Part 9A of CTA 2009 (company distributions) is amended as follows. E+W+S+N.I.

(2) In section 931A (charge to tax), omit subsection (2) and for subsection (3) substitute—

“(3) A distribution is exempt for the purposes of this Part if it is exempt under—

(a) Chapter 2 (distributions received by small companies), or

(b) Chapter 3 (distributions received by companies that are not small).”

(3) In section 931H (dividends derived from transactions not designed to reduce tax)—

(a) in the heading, for “Dividends” substitute “ Distributions ”,

(b) in subsection (1)—

(i) after “dividend” insert “ or other distribution ”, and

(ii) for “paid” substitute “ made ”,

(c) in subsection (2), for “dividend is paid” substitute “ distribution is made ”,

(d) in subsections (3) and (4)—

(i) for “dividend” substitute “ distribution ”, and

(ii) for “paid” substitute “ made ”, and

(e) in subsection (5)—

(i) for “dividend” substitute “ distribution ”,

(ii) for “paid” (in both places) substitute “ made ”, and

(iii) for “dividends” substitute “ distributions ”.

(4) After section 931R insert—

“Chargeable gains E+W+S+N.I.

931RA Chargeable gains

The fact that a dividend or other distribution is exempt does not prevent it from being taken into account in the calculation of chargeable gains.”