Income Tax (Trading and Other Income) Act 2005 section 594

Winding up of a body corporate

Section 594 deals with what happens to spread patent income when a body corporate that is liable to income tax on the sale of patent rights begins to be wound up.

• When a body corporate liable to income tax on patent rights sales begins winding up, all remaining spread amounts are accelerated into the year winding up commences
• This covers amounts that a non-UK resident seller had elected to spread over six years under sections 591 or 592
• It also covers amounts arising to the body corporate in a fiduciary or representative capacity, such as a corporate trustee, that were being spread under section 590
• The effect is that no taxable amounts from patent rights sales remain outstanding once the winding-up process has started