Corporation Tax Act 2010 section 693

Meaning of "amount of profits which represents a relevant gain"

Section 693 explains how to calculate the amount of a company's profits that represents a relevant gain, by comparing the gain itself against the total chargeable gains included for the accounting period.

• The calculation requires a comparison between two amounts: the relevant gain (Y) and the total chargeable gains or non-trading chargeable realisation gains included for the accounting period (Z).
• If the relevant gain (Y) is less than or equal to the total chargeable gains figure (Z), the amount of profits representing the relevant gain is simply Y — the full amount of the gain.
• If the relevant gain (Y) exceeds the total chargeable gains figure (Z), the amount of profits representing the relevant gain is capped at Z.
• This definition applies throughout the chapter and ensures that the profit attributed to a relevant gain cannot exceed the overall chargeable gains recognised for the period.