Corporation Tax Bill

House of Commons

Session 2009 - 10
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Other Bills before Parliament

Corporation Tax Bill

Corporation Tax Bill
Part 22 — Miscellaneous provisions
Chapter 8 — Exemptions
483

Health service bodies
985
Health service bodies
(1)
A health service body is not liable to corporation tax.
(2)
Subsection (1) is subject to any order made under section 987.
(3)
See section 986 for the meaning of “health service body”.
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986
Meaning of “health service body”
In section 985 “health service body” means a body mentioned in the following
table—

Body
Provision under which body established

the Common Services
section 10 of the National Health

10

Agency for the Scottish
Service (Scotland) Act 1978

Health Service

a Health and Social Services
Article 16 of the Health and Personal

Board
Social Services (Northern Ireland)

Order 1972 (S.I. 1972/1265 (N.I. 14))

15

a Health and Social Care
Article 10 of the Health and Personal

trust
Social Services (Northern Ireland)

Order 1991 (S.I. 1991/194 (N.I. 1))

a Health Board
section 2(1)(a) of the National Health

Service (Scotland) Act 1978

20

a Local Health Board
section 11 of the National Health

Service (Wales) Act 2006

a National Health Service
section 25 of the National Health

trust
Service Act 2006 or section 18 of the

National Health Service (Wales) Act

25

2006

an NHS foundation trust
section 30 of the National Health

Service Act 2006

the Northern Ireland Central
Article 26 of the Health and Personal

Services Agency for the
Social Services (Northern Ireland)

30

Health and Social Services
Order 1972 (S.I.1972/1265 (N.I. 14))

a Primary Care Trust
section 18 of the National Health

Service Act 2006

the Scottish Dental Practice
section 4 of the National Health Service

Board
(Scotland) Act 1978

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Corporation Tax Bill
Part 22 — Miscellaneous provisions
Chapter 8 — Exemptions
484

Body
Provision under which body established

a special health and social
Article 3 of the Health and Personal

services agency
Social Services (Special Agencies)

(Northern Ireland) Order 1990 (S.I.

1990/247 (N.I. 3))

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a Special Health Authority
section 28 of the National Health

Service Act 2006 or section 22 of the

National Health Service (Wales) Act

2006

a Special Health Board
section 2(1)(b) of the National Health

10

Service (Scotland) Act 1978

a Strategic Health Authority
section 13 of the National Health

Service Act 2006

987
NHS foundation trusts
(1)
The Treasury may by order provide that an NHS foundation trust (see the table
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in section 986) is liable to corporation tax in relation to a specified activity or
class of activity.
(2)
The Treasury may make an order under subsection (1) only—
(a)
in relation to an activity or class of activity that appears to the Treasury
to be of a commercial nature, and
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(b)
if the condition in subsection (3) is met.
(3)
The condition is that the making of an order appears to the Treasury to be
expedient for the purpose of avoiding, removing or reducing differences
between—
(a)
the tax treatment of the body undertaking the activity, and
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(b)
the tax treatment of another body or class of body which is of a
commercial nature and which undertakes or might undertake the same
or a similar activity.
(4)
For the purposes of subsection (2)(a) an activity authorised under section 43(1)
of the National Health Service Act 2006 is not to be treated as an activity of a
30
commercial nature.
(5)
An order under subsection (1) must make provision for determining the
amount of the profits relating to an activity that are to be charged to
corporation tax as a result of the order.
(6)
An order under subsection (1) may in particular—
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(a)
make provision for disregarding profits of less than a specified amount
in respect of a relevant period,
(b)
make provision for disregarding a specified part of profits in respect of
a relevant period, or
(c)
make provision for disregarding all or part of profits relating to activity
40
for which receipts or turnover (as defined by the order) are less than a
specified amount in respect of a relevant period.
(7)
“Relevant period” means—

Corporation Tax Bill
Part 22 — Miscellaneous provisions
Chapter 8 — Exemptions
485

(a)
a financial year or accounting period, or
(b)
a specified part of a financial year or accounting period.
(8)
An order under subsection (1)—
(a)
may apply, with or without modification, a provision of the Tax Acts,
(b)
may disapply a provision of the Tax Acts,
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(c)
may make provision similar to a provision of the Tax Acts, and
(d)
may make provision generally or in relation to a specified body or class
of bodies.
(9)
No order may be made under subsection (1) unless a draft of the statutory
instrument containing it has been laid before and approved by a resolution of
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the House of Commons.
Reserve Bank of India and State Bank of Pakistan
988
Issue departments of the Reserve Bank of India and the State Bank of
Pakistan
No liability to corporation tax arises in respect of income of the issue
15
department of—
(a)
the Reserve Bank of India constituted under an Act of the Indian
legislature called the Reserve Bank of India Act 1934, or
(b)
the State Bank of Pakistan constituted under certain orders made under
section 9 of the Indian Independence Act 1947.
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Agricultural societies
989
Agricultural societies
(1)
No liability to corporation tax arises in respect of profits of an agricultural
society which—
(a)
arise from an exhibition or show held for the purposes of the society,
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and
(b)
are applied solely for the purposes of the society.
(2)
In this section “agricultural society” means any society or institution
established for the purpose of promoting the interests of—
(a)
agriculture,
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(b)
horticulture,
(c)
forestry, or
(d)
the breeding of any kind of animal.

Corporation Tax Bill
Part 22 — Miscellaneous provisions
Chapter 9 — Other miscellaneous provisions
486

Chapter 9
Other miscellaneous provisions
European Economic Interest Groupings
990
European Economic Interest Groupings
(1)
The following rules about European Economic Interest Groupings apply for
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the purposes of charging corporation tax in respect of income—
Rule 1

A grouping is treated as acting as the agent of its members.
Rule 2

The activities of a grouping are treated as those of its members acting jointly.
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Rule 3

Each member of a grouping is treated as having a share of the grouping’s
property, rights and liabilities.
Rule 4

Any trade carried on by the grouping is treated as carried on in partnership by
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the members of the grouping.
(2)
For the purposes of Rule 3, a member’s share of any property, rights or
liabilities of a grouping is determined in accordance with the contract under
which the grouping is established.
(3)
If the contract does not provide for this, the member’s share is determined by
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reference to the share of the profits of the grouping to which the member is
entitled under the contract.
(4)
If the contract does not provide for this either, the members are treated as
having equal shares of the property, rights and liabilities of the grouping.
(5)
Part 5 of CTA 2009 (loan relationships) applies in relation to a grouping as it
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applies in relation to a firm.
(6)
For the purposes of subsection (5) see in particular the following provisions of
Part 5 of CTA 2009—
Chapter 9 (partnerships involving companies),
section 467 (connections where partnerships involved),
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section 472 (meaning of “control”), and
sections 473 and 474 (meaning of “major interest” etc).
(7)
“European Economic Interest Grouping” means a European Economic Interest
Grouping formed under Council Regulation (EEC) No 2137/85 of 25 July 1985,
whether registered in Great Britain, Northern Ireland or elsewhere.
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