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HMRC internal manual

Company Taxation Manual

From
HM Revenue & Customs
Updated
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Corporation Tax: computation of income: CTA09 and CTA10

The income tax Schedules (Schedule A, income from property etc) first devised in 1803 no longer apply but the system remains ‘schedular’ in that income from each source is computed separately, though now under Parts of CTA09. Although such income is chargeable to CT in aggregate it remains trading income, property income and so on.

In general, guidance in the relevant manuals (for example Business Income Manual, Property Income Manual, Corporate Finance Manual) applies with necessary adaptations subject to any special modifications set out in the Company Taxation Manual.

CTA09

CTA09/S1 provides a useful overview of the 2009 Act. It contains the charge to tax on profits (income and chargeable gains), rules for calculating income from various sources (and also chargeable gains, as respects derivative contracts), the handling of deficits, and certain special reliefs and other rules, such as those relating to

  • employee share acquisition
  • research and development
  • land remediation
  • film production.

CTA09 also contains the special rules relating to companies with investment business, partnerships involving companies and unremittable income.

CTA10

CTA10/S1 provides a useful overview of the 2010 Act. It contains provisions on rates of tax, steps in calculating the profits and currency issues. It also addresses

  • various reliefs, including small profits relief, loss relief and group relief
  • special types of business and company
  • tax avoidance
  • special situations such as transfers of trade without change of ownership
  • distributions.