Corporation Tax Act 2010 section 357UU

Northern Ireland supplementary deduction: amount

Section 357UU sets out how to calculate the amount of the Northern Ireland supplementary deduction for museums and galleries exhibition tax relief, with different approaches depending on whether the accounting period falls within one or more financial years.

• Where the accounting period falls within a single financial year, the supplementary deduction is calculated as (A − B) × ((MR − NIR) / NIR), where A is the Northern Ireland additional deduction, B is any Northern Ireland losses surrendered, MR is the main corporation tax rate, and NIR is the Northern Ireland rate.
• The deduction effectively uplifts the net additional deduction (after surrendered losses) by a factor reflecting the difference between the main rate and the Northern Ireland rate.
• Where the accounting period straddles more than one financial year, a time-apportioned calculation is required: you compute the deduction separately for each financial year, weight each result by the proportion of the accounting period falling in that year, and then add them together.
• Losses surrendered under a museums and galleries exhibition tax credit claim reduce the base figure used in the formula, ensuring the supplementary deduction only applies to the net amount of additional deduction retained by the company.