Distributions: impact on Corporation Tax: introduction
A distribution by a company is inadmissible as a deduction in computing the company’s income (CTA09/S1305).
This rule applies to profits chargeable to CT as determined by CTA09/PART2.
Where the payment of a qualifying distribution by a UK branch of a non-resident company was made before 6 April 1999, it did not result in ACT being payable as ICTA88/S14 referred only to companies resident in the UK.
However, such a distribution did have tax consequences in being non-deductible in computing income.
For payments made before 6 April 1999
See CTM20060 regarding the treatment of franked payments.
See CTM21250 regarding the treatment of foreign income dividends (FIDs) paid.