Corporation Tax Act 2009 section 1301

Restriction of deductions for annual payments

Section 1301 prevents companies from deducting certain annual payments when calculating their income, specifically where the consideration for the payment is either a dividend or something that does not need to be brought into account for corporation tax purposes.

• Annual payments that are taxable under income tax or corporation tax rules and were incurred in return for dividends or non-taxable consideration cannot be deducted from a company's income
• The restriction does not apply to payments made under marriage or civil partnership settlements following dissolution, annulment, or permanent separation
• The restriction does not apply where an individual surrenders, assigns, or releases an interest in settled property (or trust property in Scotland) in favour of a person with a subsequent interest
• The restriction does not apply to annuities granted in the ordinary course of an annuity business