ACT: set-off against CT on profits: carry-forward surplus ACT
The surplus ACT for any accounting period less any amount:
- used in a Section 239 (3) claim, or
- set off or repaid under the FID provisions,
was carried forward and dealt with for the purposes of Section 239 (but not for the purposes of ICTA88/S240) as if it were ACT paid by the company in respect of distributions made in the next accounting period.
This rule was subject to ICTA88/S240 (5), ICTA88/S245, S245A and 245B (changes in ownership).
The company could therefore carry forward ACT under Section 239 (4). If there was a surplus of ACT in the later period, the company could then carry it back again under ICTA88/S239 (3) subject to the time limit.
Such treatment may have benefited a company if the two-year time limit for making a Section 239 (3) claim in respect of the earlier accounting period had expired.
Any balance carried forward, if unrelieved, was then automatically carried forward to the next subsequent accounting period.