CTM03540 - Corporation Tax: small companies: no
associated companies: profit exceeding first relevant amount or
lower relevant max
Where in any accounting period of twelve months:
- a company has no associated companies,
and
- its profits for that accounting period
exceed the first relevant amount but do not exceed the second
relevant amount (for the starting rate),
- it may claim that the CT charged at the
small companies' rate on its basic profits shall be reduced by the
appropriate fraction (see
CTM03510 and
CTM03520) applied to the formula
below,
or
- its profits for the accounting period
exceed the lower relevant maximum amount but do not exceed the
upper relevant maximum amount (for the small companies' rate),
- it may claim that the CT charged at the
full rate on its basic profits shall be reduced by the appropriate
fraction applied to the formula below.
Formula for marginal small companies' relief:
where M = the upper relevant maximum amount,
P = the Section 13 (7) profits of the accounting period (
CTM03600), and
I = the basic profits (
CTM03505).
Formula for marginal starting rate relief:
where R2 = the second relevant amount,
P = the ICTA88/S13 (7) profits of the accounting period
(CTM03600), and
I = the basic profits (CTM03505).
