Corporation Tax Act 2010 section 357QA

Additional deduction

Section 357QA provides an enhanced additional deduction for qualifying land remediation expenditure incurred by Northern Ireland companies, adjusting the standard relief percentage to reflect the difference between the main corporation tax rate and the Northern Ireland rate.

• A Northern Ireland company entitled to the standard land remediation additional deduction receives a modified percentage for expenditure relating to Northern Ireland land.
• The adjusted percentage is calculated as: A × (MR / NIR), where A is the standard percentage (currently 50%), MR is the main corporation tax rate, and NIR is the Northern Ireland corporation tax rate.
• The effect of this formula is to increase the additional deduction so that, when taxed at the lower Northern Ireland rate, the tax benefit is equivalent to that received by a company paying the main rate.
• The portion of the additional deduction calculated using the adjusted percentage forms part of the company's Northern Ireland trading profits or losses.