Corporation Tax Act 2009 section 960

Relief in respect of tax relating to absolute interests

Section 960 provides relief from double taxation where a company with an absolute interest in the residue of a foreign estate has been charged UK corporation tax on estate income, but UK income tax has already been borne on part of that estate's aggregate income.

• Applies where a company has been charged UK corporation tax on estate income arising from an absolute interest in the residue of a foreign estate
• Relief is available only where UK income tax has already been borne on part of the estate's aggregate income for the relevant tax year
• The company must make a claim, and the corporation tax is then reduced using the formula T × (A / B), where T is the corporation tax charged, A is the portion of aggregate income that has already borne UK income tax, and B is the total aggregate income of the estate
• The effect is to reduce the corporation tax proportionately, so the company is not taxed twice on income that has already suffered UK income tax at the estate level