TTM02260 - Tonnage Tax Elections: When election takes effect?

Where an election is made outside a window of opportunity.

The flexibility on starting date given to elections made in a further window of opportunity is not appropriate for elections made outside this window, and the election has effect from the day the company or group first qualified. See paragraph 12(6).

The company’s entry into Tonnage Tax will trigger an end to the final pre-tonnage tax accounting period, and a new accounting period will therefore begin on the date of entry (if that date would not otherwise be the start of an accounting period (see TTM07010).

Deferral possible where 75% limit exceeded in first AP

However, paragraph 38(2) allows for deferral where the 75% limit has been exceeded in the first, or first and second, accounting periods after first qualifying. See TTM02410.

References