Income Tax Act 2007 section 837F

Election to carry back

Section 837F allows a company (or its liquidator) to elect that a winding-up receipt from a deposit-taking trade be treated as received on the date the trade permanently ceased, rather than in the tax year it was actually received.

• Applies to winding-up receipts from a deposit-taking trade received within 6 years of the company permanently ceasing to trade
• The company or its liquidator may elect to treat the receipt as if it had been received on the date the trade ceased, so that income tax is charged accordingly
• The election must be made within 2 years of the end of the tax year in which the receipt was actually received
• Once an election is made, an income tax assessment must be raised on that basis, overriding any other provision in the Income Tax Acts