MTT45620 - Particular entities and adjustments: Shipping: Core international shipping profits
The core international shipping profits of a member of a group consists of:
- its core international shipping revenue, less
- its core international shipping costs.
The member's underlying profits are adjusted to exclude this figure.
This is set out in section 157 of Finance (No.2) Act 2023.
Core international shipping revenue
The member’s core international shipping revenue consists of all revenue earned by the member in consideration for its performance of core international shipping activities.
Core international shipping costs
The member’s core international shipping costs consist of:
- all costs incurred by the member that are directly attributable to the performance of core international shipping activities, and
- a proportion of costs indirectly attributable to the performance of those activities.
That proportion is given by multiplying the total amount of those indirectly attributable costs by:
- the core international shipping revenue of the member for the period, divided by
- the total revenue of the member for the period.
Core international shipping activities
Core international shipping activities are:
- carrying out international shipping (see MTT45600)
- leasing out a ship to be used for international shipping, where the ship is fully equipped, crewed and supplied
- leasing out, to a member of the same group, a ship to be used for core international shipping activity
- arranging for international shipping to be carried out under slot-chartering arrangements
- the sale of a ship that has been used in international shipping, where the ship has been held for use by the member for at least one year (not necessarily the year immediately prior to the sale)