http://www.legislation.gov.uk/ukpga/2010/4/section/357ACorporation Tax Act 2010An Act to restate, with minor changes, certain enactments relating to corporation tax and certain enactments relating to company distributions; and for connected purposes.texttext/xmlenStatute Law Database2026-05-20Expert Participation2026-03-18 Corporation Tax Act 2010s. 658(1)(d)(e)Finance Act 2010Sch. 6 para. 31Sch. 6 para. 35Corporation Tax Act 2010s. 357CHAFinance Act 2024Sch. 2 para. 14(7)Sch. 2 para. 16(2) PART 8ACHAPTER 1357A1A company may elect that any relevant IP profits of a trade of the company for an accounting period for which it is a qualifying company are chargeable at a lower rate of corporation tax.2An election under subsection (1) is to be given effect by allowing a deduction to be made in calculating for corporation tax purposes the profits of the trade for the period.3The amount of the deduction is— RP × ( MR – IPR MR )where— RP is the relevant IP profits of the trade of the company,“AR” means, in relation to a company— in a case where corporation tax is charged at the standard small profits rate on the company’s taxable total profits of the accounting period mentioned in subsection (1) which are not ring fence profits, that rate, or in any other case, the main rate of corporation tax.IPR is the special IP rate of corporation tax.4The special IP rate of corporation tax is 10%.5Chapter 2 specifies when a company is a qualifying company.6Chapter 2A makes provision for determining the relevant IP profits or relevant IP losses of a trade of a company for an accounting period in a case where—athe accounting period begins on or after 1 July 2021, orbthe company is a new entrant (see subsection (11)).7Chapters 2B, 3 and 4 make provision for determining the relevant IP profits or relevant IP losses of a trade of a company for an accounting period in various cases where—athe accounting period begins before 1 July 2021, andbthe company is not a new entrant.8Chapter 5 makes provision in relation to the relevant IP losses of a trade.9Chapter 6 contains anti-avoidance provisions.10Chapter 7 contains supplementary provision.11A company is a “new entrant” for the purposes of this Part if—athe first accounting period for which the company's election (or most recent election) under subsection (1) has effect begins on or after 1 July 2016, orbthe company elects to be treated as a new entrant for the purposes of this Part.Pt. 8A inserted (with effect in accordance with Sch. 2 paras. 7, 8 of the amending Act) by Finance Act 2012 (c. 14), Sch. 2 para. 1(1)S. 357A(11) inserted (with effect in accordance with s. 64(7) of the amending Act) by Finance Act 2016 (c. 24), s. 64(2)(b)S. 357A(6)(7) substituted (with effect in accordance with s. 64(7) of the amending Act) by Finance Act 2016 (c. 24), s. 64(2)(a)Words in s, 357A(3) substituted (for accounting periods beginning on or after 1.4.2023) by Finance (No. 2) Act 2023 (c. 30), s. 11(1)(b)(2)S. 357A(3) formula: word “AR” substituted for word “MR” in both places it occurs (for accounting periods beginning on or after 1.4.2023) by Finance (No. 2) Act 2023 (c. 30), s. 11(1)(a)(2)