Corporation Tax Act 2009 section 18F

Effect of election

Section 18F explains when an election to exempt foreign permanent establishment profits or losses takes effect, how it interacts with accounting periods, and the limited circumstances in which it can be revoked.

• The election applies to all accounting periods beginning on or after the "relevant day" and is generally irrevocable once that day arrives
• For UK resident companies, the relevant day is the expected start of the next accounting period after the one in which the election is made; for non-UK resident companies, it is the day they become UK resident
• If an accounting period straddles the relevant day, it is split into two notional periods with profits and losses apportioned on a just and reasonable basis
• The election can be revoked before the relevant day and is automatically revoked if the company ceases to be UK resident