Corporation Tax Act 2010 section 431

"Profits" and "loss"

Section 431 clarifies the meaning of "profits" and "loss" as used throughout this chapter, specifically excluding chargeable gains and capital losses.

• For the purposes of this chapter, "profits" means income profits only and does not include chargeable gains.
• References to "loss" throughout the chapter are similarly restricted to income losses, excluding capital losses.
• This distinction is particularly relevant for partnerships where different profit-sharing ratios may apply to income items versus capital items.
• Only the profit-sharing ratios for income profits and losses are used when calculating a company's percentage share under this chapter.