Corporation Tax Act 2010 section 124

Assumptions as to places in which activities carried on

Section 124 requires that, when recalculating the EEA amount under UK tax rules, all of the surrendering company's activities must be treated as if they were carried on in the United Kingdom rather than in the EEA territory.

• When recalculating the EEA amount, the company's activities must be assumed to take place in the United Kingdom, not in the EEA territory where they actually occur.
• This assumption means that any special UK tax rules dealing with foreign income do not come into play, because everything is treated as domestic.
• Any land held by the surrendering company must also be assumed to be situated in the United Kingdom.
• UK legal concepts of "estate", "interest" and "rights" in land are to be applied to land that is actually located outside the United Kingdom, so that it can be treated consistently under UK tax rules.