Corporation Tax Act 2009 section 108

Receipt of benefits by donor or connected person

Section 108 deals with the tax consequences when a company (or a person connected with it) receives a benefit that is linked to a charitable gift for which tax relief was claimed.

• If a company claims relief on a gift of trading stock, medical supplies/equipment, or plant and machinery to charity, any benefit received in connection with that gift is clawed back as taxable income.
• The clawback also applies where a benefit is received in connection with costs of transporting, delivering, or distributing gifted medical supplies and equipment for which relief was claimed.
• The benefit is taxable whether it is received by the donor company itself or by a person connected with the company.
• The value of the benefit is treated as a trading receipt if the company is still trading, or as a post-cessation receipt if the company has permanently ceased to trade.