Finance Act, 1977
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Amendment of section 28 (reduction of corporation tax liability of small companies) of Corporation Tax Act, 1976. |
17.—(1) Section 28 of the Corporation Tax Act, 1976 , shall have effect for the financial year 1977 and each subsequent financial year as if— | |
(a) in subsection (1) for “40 per cent.” there were substituted “35 per cent.”, | ||
(b) in subsection (2) for “10 per cent.” there were substituted “20 per cent.” and | ||
(c) in subsection (3) for each reference to £5,000 there were substituted a reference to £10,000 and for each reference to £10,000 there were substituted a reference to £15,000. | ||
(2) Where, by virtue of subsection (1), the said section 28 has effect with different lower and upper relevant maximum amounts in relation to different parts of the same accounting period of a company, those parts shall be treated for the purposes of that section as if they were separate accounting periods of the company, and profits and income (within the meaning, in both cases, of the said section 28) of the company for the first mentioned period shall be apportioned between those parts. | ||
(3) (a) Section 28 (7) of the Corporation Tax Act, 1976 , is hereby amended by the insertion after “companies within the group” of “, and for this purpose a company shall be treated as a member of a group and franked investment income received by the company from another company shall be treated as coming from companies within the group where, but only where, if such income had been such payment as is referred to in section 105 (1), it would have been paid without deduction of income tax or would have been so paid if the companies had so elected”, and the said subsection (7), as so amended, is set out in the Table to this section. | ||
(b) This subsection shall have effect as respects franked investment income arising in the year 1976-77 or in subsequent years of assessment. | ||
TABLE | ||
(7) For the purposes of the foregoing subsections the profits of a company for an accounting period shall be taken to be the amount of its profits for that period on which corporation tax falls finally to be borne, with the addition of franked investment income other than franked investment income which the company (if a member of a group) receives from companies within the group, and for this purpose a company shall be treated as a member of a group and franked investment income received by the company from another company shall be treated as coming from companies within the group where, but only where, if such income had been such payment as is referred to in section 105 (1), it would have been paid without deduction of income tax or would have been so paid if the companies had so elected. |