Taxation (International and Other Provisions) Act 2010

41 Amount of limit

(1) In subsection (2) “the total credit” means—

F + G

where—

• F is the total credit, under all tax-relief arrangements, allowed under section 18(2) against a person’s income tax for any tax year, and

• G is the total credit, under all tax-relief arrangements, allowed under section 18(2) against the person’s capital gains tax for that tax year.

(2) The total credit is not to be more than—

I + C − A

where—

• I is the total income tax payable by the person for the tax year,

• C is the total capital gains tax payable by the person for the tax year, and

• A is the total amount of the tax treated under section 414 of ITA 2007 (gift aid) as deducted from gifts made by the person in the tax year.

(3) In calculating I and C for the purposes of subsection (2), no reduction is to be made for credit under section 18(2).

(4) Subsection (2) applies in addition to sections 36 and 40.

(5) For the purposes of subsection (1) the following are “tax-relief arrangements”—

(a) double taxation arrangements, and

(b) unilateral relief arrangements for a territory outside the United Kingdom.