Corporation Tax Act 2009 section 986

Treatment of receipts under Chapter

Section 986 explains how amounts treated as received by a company when share scheme relief is withdrawn are to be taxed.

• If the company is still carrying on a trade or property business within the charge to corporation tax, the amount is taxed as a trading or business receipt.
• If the company has permanently ceased that trade or property business, the amount is taxed as a post-cessation receipt.
• In all other cases, the amount is simply charged to corporation tax on income.
• Loss relief is not available against amounts charged under the residual corporation tax on income route, because the charge does not arise from a transaction.