845B Set-off of surplus advance corporation tax.

(1) In this section—

“surplus advance corporation tax”, in relation to an accounting period of a company, means an amount of advance corporation tax—

(a) to which the company was liable under section 159 in respect of a distribution made before 6 April 1999,

(b) which was paid by the company and not repaid to it, and

(c) which was not set against the company’s liability to corporation tax for any preceding accounting period.

(2) Where in the case of an accounting period of a company there is an amount of surplus advance corporation tax, that amount shall be set against the company’s liability to corporation tax on any income charged to corporation tax for that accounting period and shall accordingly discharge a corresponding amount of that liability.

(3) For the purposes of this section—

(a) the income of a company charged to corporation tax for any accounting period shall be taken to be the amount of its profits for that period on which corporation tax falls finally to be borne exclusive of the part of the profits attributable to chargeable gains, and

(b) the part of the profits so attributable shall be taken to be the amount brought into the company’s profits for that period for the purposes of corporation tax in respect of chargeable gains before any deduction for charges on income, expenses of management or other amounts which can be deducted from or set against or treated as reducing profits of more than one description.

(4) For the purposes of this section, a notice under section 884 may require the inclusion in the return to be delivered by a company under that section of particulars of any surplus advance corporation tax carried forward in relation to that company under subsection (2).

(5) Where an inspector discovers that any set-off of surplus advance corporation tax under this section ought not to have been made, or is or has become excessive, the inspector may make any such assessments as may in his or her judgment be required for recovering any tax that ought to have been paid and generally for securing that the resulting liabilities to tax (including interest on unpaid tax) of the person concerned are what they would have been if only such set-offs had been made as ought to have been made.