Corporation Tax Act 2010 section 356OE

Disposals within section 356OD: profits treated as trading profits

Section 356OE establishes how profits or gains from disposals of property deriving its value from UK land are treated as trading profits of the chargeable company for corporation tax purposes.

• The portion of any profit or gain attributable to UK land (the "relevant amount") is treated as trading profits of the chargeable company, and for non-UK resident companies this is specifically treated as profits of a trade of dealing in or developing UK land.
• This treatment does not apply to any amount that would already be brought into account as income for corporation tax or income tax purposes, thereby preventing the same profit from being taxed twice.
• The profits are treated as arising in the accounting period of the chargeable company in which the profit or gain is actually realised.
• The section applies equally to gains that are capital in nature as it does to revenue gains, ensuring that attempts to recharacterise trading profits as capital gains do not avoid the charge.