Capital Allowances Act 2001 section 6D

NI rate activity treated as separate trade

Section 6D requires that Northern Ireland rate activity is treated as a separate trade for capital allowances purposes, so that allowances and charges relating to that activity are calculated independently from the rest of the company's or firm's trade.

• NI rate activity carried on by an SME (Northern Ireland employer) company or a NIRE company must be treated as a separate trade, distinct from any other activities within the same trade.
• The same separate trade treatment applies to NI rate activity carried on by a Northern Ireland firm for the purposes of the corporate partner calculation.
• The corporate partner calculation means the process of determining capital allowances and charges when working out the firm's profits chargeable to corporation tax under section 1259 of the Corporation Tax Act 2009.
• The effect is to ring-fence NI rate activity so that capital allowances attributable to it are computed separately, supporting the application of the Northern Ireland corporation tax rate to qualifying profits.