Corporation Tax Act 2010 section 966

Payments for surrendered tax refunds

Section 966 deals with the corporation tax treatment of payments made between group companies in return for the surrender of a tax refund.

• When a group company surrenders a tax refund to another group company under a formal agreement, the receiving company may make a payment in return.
• Any such payment must not exceed the amount of the tax refund specified in the surrender notice.
• The payment is ignored when calculating the profits or losses of either company for corporation tax purposes.
• The payment is not treated as a distribution under the Corporation Tax Acts.