Introduction Summary
1.Section 34 and Schedule 14 determine the scope of the corporation tax charge on income on both UK and foreign company distributions. The rules for distributions received by small companies are distinct from the rules for medium and large companies, but in each case the result is that the great majority of distributions will be exempt from corporation tax. The Schedule contains anti-avoidance rules to prevent abuse of distribution exemption.
2.The changes introduced by this section are part of the package of measures being introduced as a result of the Government’s review of the taxation of foreign profits.