Taxes Consolidation Act 1997 section 26

General scheme of corporation tax

Section 26 sets out the general scope of the corporation tax charge, confirming that it applies to all profits of a company wherever arising, and explains how assessments are made by reference to accounting periods even though the tax is charged by financial year.

• An Irish-resident company is chargeable to corporation tax on all its profits from worldwide sources, subject to specific exceptions in the Corporation Tax Acts.
• The charge extends to profits accruing to a company through a trust or partnership, and to profits arising on a winding up, but not to profits received in a purely fiduciary or representative capacity (except to the extent of the company's own beneficial interest).
• Corporation tax is charged on profits arising in a financial year, but assessments are made by reference to the company's accounting periods, with profits apportioned on a time basis where an accounting period straddles two financial years.
• A transitional measure (now spent) dealt with accounting periods straddling 1 April 1997 by deeming certain periods to be single financial years, avoiding an unnecessary three-way split of profits.