Taxes Consolidation Act 1997 section 697M

Exclusion of reliefs, deductions and set-offs

Section 697M restricts the use of reliefs, deductions and set-offs against a company's tonnage tax profits and the corresponding tonnage tax liability.

• No relief, deduction or set-off of any kind may be claimed against a company's tonnage tax profits.
• Losses accrued before entry into tonnage tax that relate to activities or income sources now within the tonnage tax trade are unavailable for loss relief from the date of entry, though they may be used against a balancing charge under paragraph 17 of Schedule 18B.
• Reliefs or set-offs against a company's tax liability (including double tax relief) cannot be applied to the portion of that liability attributable to tonnage tax profits.
• The restriction on tax liability set-offs does not apply to income tax deducted from annual payments made to the company, which remains available for credit against corporation tax.