Taxes Consolidation Act 1997 section 845B

Set-off of surplus advance corporation tax

Section 845B provided for the set-off of surplus advance corporation tax (ACT) — paid in respect of distributions made before 6 April 1999 — against a company's corporation tax liability on income in subsequent accounting periods. This section is now spent.

• Surplus ACT was defined as ACT paid (and not repaid) on distributions made before 6 April 1999 that had not already been set against corporation tax for any earlier accounting period.
• A company carrying surplus ACT could set it against its corporation tax liability on income for the accounting period, but not against the portion of profits attributable to chargeable gains.
• Where charges on income, management expenses, or similar deductions could be set against more than one description of profits, the chargeable gains element was calculated before deducting those amounts.
• An inspector could raise assessments to recover tax where a set-off of surplus ACT was found to have been made incorrectly or excessively.