Corporation Tax Act 2010

Industrial and provident society payments

1055 Industrial and provident societies: interest and share dividends

(1) Interest paid by a registered industrial and provident society in respect of a mortgage, loan, loan stock or deposit is not a distribution for corporation tax purposes.

(2) If any dividend, bonus, interest or other sum—

(a) is paid to a shareholder in a registered industrial and provident society, and

(b) is payable by reference to the amount of the shareholder’s holding in the society’s share capital,

it is not a distribution for corporation tax purposes.

(3) Subsections (1) and (2) apply even if the amount in question would otherwise be a distribution by virtue of any enactment relating to corporation tax.

(4) For the purposes of this section crediting an amount counts as paying it.

(5) See also section 379(1) of ITTOIA 2005 (income tax treatment of sums payable as mentioned in subsection (2)).

1056 Dividend or bonus relating to transactions

(1) This section applies if—

(a) a dividend or bonus is granted by a registered industrial and provident society, and

(b) section 132 of CTA 2009 (dividends etc relating to transactions with an industrial and provident society) allows the sum representing the dividend or bonus to be deducted in calculating the profits of a trade.

(2) The dividend, or the bonus, is not a distribution for the purposes of the Corporation Tax Acts.