The Corporation Tax (Treatment of Unrelieved Surplus Advance Corporation Tax) Regulations 1999
These Regulations provide for the treatment of unrelieved surplus advance corporation tax arising as a result of the abolition (by virtue of section 31 of the Finance Act 1998) of advance corporation tax (“ACT”) in respect of distributions made by a company on or after 6th April 1999. In computing the amount of unrelieved surplus ACT that may be set off against a company’s liability to corporation tax for an accounting period beginning on or after 6th April 1999 so as to discharge a corresponding amount of that liability, the Regulations provide for notional amounts of ACT (“shadow ACT”) to be treated as paid by the company in respect of distributions made on or after that date, and for those notional amounts to be set off against the company’s liability to corporation tax before amounts of unrelieved surplus ACT may be set off so as to reduce that liability.