Corporation Tax Act 2010 section 4

Amount of profits to which corporation tax rates applied

Section 4 sets out the staged calculation by which a company arrives at its taxable total profits — the figure to which the corporation tax rate or rates are applied.

• Total profits are the sum of the company's income chargeable to corporation tax and its chargeable gains, each after any reliefs that reduce those individual components.
• Taxable total profits are found by deducting from total profits any amounts that may be relieved against them, such as management expenses or group relief.
• The corporation tax rate or rates for the accounting period are then applied to the taxable total profits figure to produce the basic tax charge.
• The entire calculation is subject to the wider Corporation Tax Acts, which may exclude certain income (for example, qualifying charitable income) or impose a special ordering of reliefs.