Corporation Tax Act 2009 section 943

Absolute interests

Section 943 explains how to calculate the basic amount of estate income that a company must recognise when it holds an absolute interest in the residue of an estate in administration.

• For each accounting period before the final period, the basic amount of estate income is the lower of the total sums actually paid to the company in respect of that interest during the period, or the company's assumed income entitlement for that period.
• For the final accounting period, the basic amount equals the company's full assumed income entitlement, ensuring all previously untaxed income is brought into charge.
• If the estate's residuary income in the final tax year is nil because allowable deductions exceed the estate's aggregate income, the basic amount for the final period is reduced by the excess (or a just and reasonable share of it if the company holds only a partial interest).
• Special rules apply where there have been successive interests in the estate, which may modify the calculation described above.