Corporation Tax Act 2009 section 286

Election to carry back

Section 286 allows a company to elect to have a post-cessation receipt from a UK property business taxed as if it had been received in the accounting period when the business ceased.

• When a company receives income after ceasing a UK property business, it can elect to carry that receipt back to the final accounting period of the business.
• The election means the receipt is taxed as though it arose in the period when the UK property business ended, rather than when it was actually received.
• The rules that apply are the same as those for post-cessation receipts from trades (sections 198 to 200), but with references to a trade replaced by references to a UK property business.
• This can be beneficial where the company's tax position was more favourable in the earlier cessation period than in the period when the receipt was actually received.