Corporation Tax Act 2009
What this means for your business
- Enforced by
- HMRC
- Applies to
- United Kingdom
- On this page
- 15 compliance obligations, 1 practical guide
What you must do
15 compliance obligations under this legislation — 1 can result in imprisonment.
Risk assessment 1
Prepare tax estimates at balance sheet date
When you prepare your company’s accounts you must also work out a reasonable estimate of the corporation tax you will owe, using all the facts that are relevant at the balance‑sheet date. This estimate is required for each accounting period and forms the basis of your tax return.
Management duties 2
Ensure at least 10% of programme core costs are UK expenditure
If your company produces a film or TV programme that qualifies for corporation tax relief, you must make sure that at least 10% of the core spending on that programme is incurred in the UK. This means you need to plan and track your project costs so the UK‑based spend meets the threshold before you claim the tax credit.
Obtain British film certification
If your company makes a film and wants to claim the UK film tax relief, you must first get the Secretary of State to certify the film as a British film under Schedule 1 to the Films Act 1985. Without that certificate you cannot qualify for the tax deduction or credit.
Payments and fees 1
Claim and use television tax credit
If your company qualifies for a television tax credit, you must submit a claim to HMRC. Once the claim is approved, HMRC will pay the credit, which you can use to reduce your corporation tax bill. HMRC will only pay the credit after you have settled any PAYE, visiting‑performer or Class 1 NIC liabilities for that accounting period, unless they give you a provisional amount.
Record keeping 2
Calculate and claim fixed‑rate writing‑down allowance each accounting period
If your company chooses the fixed‑rate writing‑down allowance (under s.730), you must each accounting period add a tax debit equal to the lower of 4% of the asset’s cost or the remaining written‑down value. For periods shorter than a year, the 4% amount is reduced proportionately. This adjustment must be reflected in your corporation tax computation.
Record tax credit for negative goodwill gains
If your company records a profit from negative goodwill when you acquire another business, you must also create a matching tax credit. The credit should reflect the part of that profit linked to intangible assets and will reduce your taxable profit for that accounting period.
Reporting and filing 9
Adjust corporation tax to counteract avoidance arrangements
If your company holds a relevant investment and you or anyone else enters into a scheme whose main purpose is to gain a tax advantage, you must adjust your corporation tax calculation to remove that advantage. The adjustment must be just and reasonable and must be reflected in your tax return.
Amend corporation tax return if UK expenditure condition not met
2 years imprisonmentIf your company claimed tax relief for a theatrical production and later discovers that the UK‑expenditure condition isn’t satisfied when the separate theatrical trade ends, you must remove that relief and correct your corporation tax return for any periods that relied on it. You also need to submit a final statement of core UK expenditure and treat the relief as never having applied, even if the normal time‑limit for amendments has passed.
Amend tax return and provide UK expenditure statement when relief conditions fail
If your company has claimed provisional orchestra tax relief and later discovers the UK expenditure requirement won’t be met, you must remove that relief from your corporation tax return and file an amended return. When you stop the separate orchestral trade, you also have to declare the cessation on your tax return and attach a final statement showing the UK core expenditure. These changes must be made even if normal time limits for amendments have passed.
Amend tax return if exhibition relief claim becomes invalid
If your company has claimed museum and galleries exhibition tax relief and later discovers that the UK expenditure requirement is not met, or you stop the separate exhibition trade, you must remove the relief claim and file an amended corporation tax return for any periods affected. You also need to include a final statement showing the amount of UK core expenditure for the exhibition.
Attach film certification to tax returns to claim special film relief
If you want to claim the special film tax relief, you must send the appropriate British‑film certificate with the company tax return for the period in question. If the certificate is later revoked or expires, you must stop claiming the relief and amend any returns that used it.
Declare UK core expenditure to claim special TV relief
If your company wants to claim special television relief, you must put the amount of planned UK‑based core spending for the programme on your interim company tax return. When the programme finishes (or is abandoned) you must submit a final UK‑expenditure figure with the completion‑period return and correct any earlier returns if the condition is not met.
Include non‑trading loan deficits in corporation tax returns
If your company records a loss from its loan relationships (for example, interest expenses exceed interest income), you must carry that loss into your corporation tax calculation. Follow the rules set out in Chapter 16 of the Corporation Tax Act, even if the loans aren’t treated as a source of income. This ensures your tax bill is calculated correctly.
Record sale of old animal and claim deduction for replacement
When you sell an animal from your herd and replace it with another, you must treat any sale proceeds as income in your corporation tax calculation. You can then deduct the cost of the new animal, but only up to the amount you would have spent to buy a like‑for‑like replacement if the new animal is of higher quality.
Refer your clearance application to tribunal if HMRC is slow or unsatisfied
If you’re applying for a tax clearance and HMRC doesn’t give you a decision within 30 days (or dismisses you), you have to ask HMRC to send the case to a tribunal within the next 30 days. This helps protect you from an unfair or delayed decision.
Penalties for non-compliance
1 penalty under this legislation. 1 can result in imprisonment. 1 carry an unlimited fine.
Wrongful disclosure of revenue or customs information
Unlimited fine and/or 2 years imprisonment
Practical guidance
Our guides explain how to comply with the requirements above.
Sections and provisions
500 classified provisions from this legislation.
Duties 15
- s.114 Replacement of animals in herd
- s.1194 Estimates
- s.1197 British film
- s.1213 Certification as a British film is not entitled
- s.1216EB The UK expenditure condition is not entitled
- s.1216CJ Payment in respect of television tax credit liability of the company
- s.1216CE UK expenditure
- s.1217TA Clawback of provisional relief ceases
- s.1217NA Clawback of provisional relief
- s.1218ZEA Clawback of provisional relief ceases
- s.300 Method of bringing non-trading deficits into account
- s.428 Decision on application for clearance s Revenue and Customs
- s.492 Holding coming within section 490: calculation to undo avoidance must make adjustments
- s.724 Negative goodwill
- s.731 Writing down at fixed rate: calculation
Offences and penalties 2
Powers 22
- s.1179DM Television programmes: certification and revocation
- s.1199 Additional deduction for qualifying expenditure
- s.1201 Film tax credit claimable if company has surrenderable loss
- s.1216 Time limit for amendments and assessments
- s.1217CM Confidentiality of information
- s.1217H Claim for additional deduction
- s.124 Slaughter under disease control order
- s.1247 Introduction
- s.1275 Claim for relief for unremittable income
- s.1281 Income from savings certificates
- s.1323 Power to make consequential provision
- s.1324 Power to undo changes
- s.236 Payment of tax by instalments
- s.253 Regulations
- s.314 Power to make regulations about changes from amortised cost basis
- s.463B Claim to set off deficit against profits of deficit period or earlier periods
- s.533 Power to change conditions for non-qualifying shares
- s.701 Power to amend some provisions
- s.855 Further provision about regulations under section 854
- s.877 Election for fixed-rate writing down in relation to resulting asset
- ... and 2 more powers
Definitions 120
- Schedule 2 Transitionals and savings relevant tax purposes superseded enactment the relevant period
- Schedule 4 Index of defined expressions
- s.5A Arrangements for avoiding tax relevant tax advantage double taxation arrangements tax advantage
- s.12 Companies being wound up
- s.51 Relationship between rules prohibiting and allowing deductions any relevant permissive rule in this Part relevant tax avoidance arrangements
- s.70 Employees seconded to charities and educational establishments educational establishment the period of the secondment
- s.83 Meaning of “local enterprise organisation” local enterprise organisation Local enterprise agency Training and enterprise council
- s.87 Expenses of research and development research and development
- s.1001 Overview of Part
- s.1004 Groups, consortiums and commercial associations of companies Group transfer Commercial association of companies
- s.1019 Calculation of relief if shares are restricted or convertible the EMI code
- s.1032 Meaning of “chargeable event” chargeable event
- s.1042 “Relevant research and development”
- s.1123 “Staffing costs” social security legislation pension fund pension benefits
- s.1129 Qualifying expenditure on externally provided workers: connected persons
- s.1134 Qualifying element of contractor payment: connected persons Relevant period
- s.1138B Exempt foreign permanent establishments
- s.1141 “Payment period” payment period
- s.1142B “R&D claim” R&D claim
- s.1144 “Qualifying land remediation expenditure” qualifying land remediation expenditure
- ... and 100 more definitions
Exemptions 58
- s.10 End of accounting period
- s.18M Streamed opening negative amounts: “matching”
- s.39 Profits of mines, quarries and other concerns
- s.60A Rental rebates
- s.98 Tax treatment of reverse premiums
- s.1000 Deduction for costs of setting up employee share ownership trust
- s.1009 Conditions relating to employee's income tax position
- s.1132A “Qualifying earnings”
- s.1210 Use of losses in later periods
- s.1217MB Use of losses in the completion period
- s.1217CB British video game
- s.1217DB Use of losses in later periods
- s.1218ZDB Use of losses in the completion period
- s.1223A Exception for basic life assurance and general annuity business
- s.129 Conversion etc of securities held as circulating capital
- s.1309 Payments treated as made to visiting performers
- s.149D Allowable deductions: inscriptions
- s.189 Extent of charge to tax
- s.221A Sums to which sections 217 to 221 do not apply
- s.310 Power to make regulations about recognised amounts
- ... and 38 more exemptions