Corporation Tax Act 2009

Chapter 4 Income from holding an office

969 Charge to tax on income from holding an office

(1) The charge to corporation tax on income applies to income from the holding of an office.

(2) The amount of any income charged to tax under this section is to be calculated in accordance with income tax principles and all questions as to any of the following matters are to be determined in accordance with income tax law and practice as if accounting periods were years of assessment—

(a) the amounts which are or are not to be taken into account as a person’s income from the holding of an office,

(b) the amounts which are or are not to be taken into account in calculating a person’s income from the holding of an office,

(c) the amounts which are or are not to be charged to tax as a person’s income from the holding of an office, and

(d) the time when any such amount is to be treated as arising.

(3) Subsection (2) is subject to the provisions of the Corporation Tax Acts.

(4) Accordingly—

(a) for corporation tax purposes income from the holding of an office is to be calculated under Part 2 of ITEPA 2003 (employment income) and the provisions applicable to that Part, and

(b) any provision of the Income Tax Acts (other than ITTOIA 2005 or ITA 2007) which has the effect of conferring an exemption from income tax in relation to income from the holding of an office has the corresponding effect for corporation tax purposes, unless otherwise provided.

(5) For the purposes of this section “income tax law” means, in relation to an accounting period of a company, the law applying to the charge on individuals of income tax for the tax year in which the period ends, but does not include—

(a) such of the enactments of the Income Tax Acts as make special provision for individuals in relation to matters referred to in subsection (2), or

(b) ITA 2007.

(6) In this section “office” includes in particular any position which has an existence independent of the person who holds it and may be filled by successive holders.

970 Rule restricting deductions for bad debts

(1) This section applies only to debts to which Part 5 (loan relationships) does not apply.

(2) In calculating the income of an office held by a company, no deduction is allowed in respect of a debt owed to the company, except—

(a) by way of impairment loss, or

(b) so far as the debt is released wholly and exclusively for the purposes of the office as part of a statutory insolvency arrangement.

(3) In this section “debt” includes an obligation or liability that falls to be discharged otherwise than by the payment of money.